[June 03, 2009] Fitch Assigns Rating to American Tower Corp.'s Unsecured Notes Tweet Jun 02, 2009 (Close-Up Media via COMTEX) -- Fitch Ratings has assigned a 'BB+' rating to American Tower Corp.'s (AMT) proposed ten-year $300 million senior unsecured notes. According to officials, proceeds from the notes offering will be used to limit existing indebtedness and for general corporate purposes. The Rating Outlook is Stable. Fitch rates AMT's long-term Issuer Default Rating (IDR) at 'BB+'. Fitch noted that AMT's ratings are underpinned by the company's high margin, which was 68 percent for the last twelve months (LTM) ending March 31, and reflective of the operational scale provided by its tower portfolio. AMT, as well as other companies in the tower industry, are expected to benefit from wireless carriers expanding their networks following the Advanced Wireless Services spectrum auction and 700-MHz spectrum auction, which were completed in 2006 and 2008, respectively. Fitch expects this growth to more than offset modest effects of wireless operator consolidation on AMT's results. Officials noted that concerns are relatively modest and consist of uncertainty regarding the timing of payments to the company by certain international customers operations suffering from the lack of credit availability. International expansion, including the pending acquisition of XCEL Telecom in India, slightly increases the company's risk profile, but operations outside of the domestic market are expected to remain modest. Fitch also notes that the company has scaled back its share repurchase activity, with less than $2 million of common stock repurchased in the first quarter of 2009, in order to retain substantial financial flexibility. Fitch views AMT's liquidity position as strong due to the meaningful free cash flow generation, its balance sheet cash and favorable maturity schedule relative to available liquidity. Debt maturities over the remainder of 2009 through 2011 are only $60 million, substantially exceeded by free cash flow (FCF), which for the LTM was approximately $548 million. Cash, including restricted cash, was $365 million as of March 31, and Fitch expects FCF levels in 2009 growing over the $530 million achieved in 2008. Fitch notes that nearly $2 billion of debt, including the revolver, is due in 2012. Fitch is an international ratings agency. ((Comments on this story may be sent to [email protected])) [ Back To TMCnet.com's Homepage ]