|By Business Wire||
|November 8, 2012 05:01 PM EST||
Fitch Ratings has assigned a 'B+/RR4' rating to Sprint Nextel Corporation's (Sprint Nextel) benchmark-sized offering of senior unsecured notes due 2022. The proceeds from the offering are expected to be used for redemption of outstanding debt. All of Sprint Nextel's ratings remain on Rating Watch Positive. As of Sept. 30, 2012 Sprint Nextel had approximately $21.3 billion of debt outstanding.
The issuance is in line with the company's strategy to opportunistically refinance looming scheduled debt maturities. In Fitch's view, Sprint has strengthened its liquidity position and reduced medium-term refinancing risks. However the company's scheduled maturities total approximately $3.3 billion during the next three years. Maturities include approximately $300 million in 2013, $1.4 billion in 2014, and $1.6 billion in 2015.
Sprint Nextel's liquidity position is supported by $6.3 billion of cash and $1.2 billion borrowing capacity under its revolving credit agreement which is set to expire during October 2013. In addition, approximately $423 million is available through May 31, 2103 under the first tranche of the secured equipment credit facility. The $8 billion cash investment by Softbank Corp. affords Sprint Nextel considerable financial flexibility to address refinancing requirement and strategic investments.
Sprint Nextel will also likely need to consider parameters for a new facility by the end of 2012 or early 2013, given the October 2013 maturity. Sprint was also considering parameters for $2 billion in additional vendor financing with its equipment suppliers. Given this new cash injection, additional uncertainty exists whether Sprint Nextel would still raise additional financing by this means. The current liquidity (absent the Softbank cash infusion) addressed Sprint Nextel's material cash requirements expected through at least 2013, which could be in excess of $5 billion due primarily to the network modernization project and iPhone rollout.
The Rating Watch Positive reflects Fitch's belief that the strategic agreement Sprint Nextel entered with Softbank Corp. including the $8 billion cash infusion strengthens Sprint Nextel's financial and operating profile longer term. With $8 billion in added funding, Fitch believes Sprint Nextel could advance or accelerate certain strategic initiatives to improve their longer-term competitive position. Additional spectrum for Sprint Nextel's 4G network, other consolidation opportunities, and accelerating LTE build-outside of current plans could likely be a high priority.
Resolution of the Rating Watch depends upon several factors. These factors would include fully assessing the degree of linkage in the relationship between Softbank and Sprint Nextel for legal ties, operational ties and strategic ties. Fitch would access Sprint Nextel execution on stated objectives and whether the company demonstrated further operational and financial improvements as expected. Any planned uses of the cash infusion would also be reviewed.
The majority of debt at Sprint Nextel has change of control provisions. The change of control is triggered in the event when more than 50% of the voting power of the company changes and a downgrade occurs to the debt ratings. The debt at Nextel and Sprint Capital Corp. does not have change of control provisions.
On Oct. 15, 2012, Sprint Nextel and Softbank reached a series of definitive agreements under which Softbank will invest $20.1 billion, consisting of $12.1 billion to be distributed to Sprint Nextel stockholders and $8 billion to Sprint Nextel. As part of Softbank's cash contribution, Sprint Nextel issued a seven-year, convertible bond with a face amount of $3.1 billion to Softbank. Immediately prior to the merger assuming regulatory and shareholder approval, the bond will be converted into shares of Sprint. Closing of the transaction is anticipated mid-2013.
WHAT COULD TRIGGER A RATING ACTION
Negative: The ratings are on Rating Watch Positive. As a result, Fitch does not currently anticipate developments with a material likelihood, individually or collectively, leading to a rating downgrade.
Positive: The ratings are on Rating Watch Positive. Future developments that may, individually or collectively lead to positive rating action include:
--Expected completion of merger with the $8 billion cash injection
--The degree of operational, strategic, and legal linkage between Softbank and Sprint;
--Trends associated with operating performance for postpaid subscribers, churn, and ARPU;
--Sprint Nextel's continued progress with network modernization plans including cost improvements and LTE network deployment.
Additional information is available at 'www.fitchratings.com'. The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings.
In addition to the sources of information identified in Fitch's Revenue-Supported Rating Criteria and U.S. Public Power Rating Criteria, this action was informed by information from CreditScope.
Applicable Criteria and Related Research:
--'Revenue-Supported Rating Criteria', June 12, 2012;
--'U.S. Public Power Rating Criteria', Jan. 11, 2012.
Applicable Criteria and Related Research:
Revenue-Supported Rating Criteria
U.S. Public Power Rating Criteria
Rating Telecom Companies
Technology vendors and analysts are eager to paint a rosy picture of how wonderful IoT is and why your deployment will be great with the use of their products and services. While it is easy to showcase successful IoT solutions, identifying IoT systems that missed the mark or failed can often provide more in the way of key lessons learned. In his session at @ThingsExpo, Peter Vanderminden, Principal Industry Analyst for IoT & Digital Supply Chain to Flatiron Strategies, will focus on how IoT depl...
Jan. 21, 2017 03:45 AM EST Reads: 1,984
Big Data, cloud, analytics, contextual information, wearable tech, sensors, mobility, and WebRTC: together, these advances have created a perfect storm of technologies that are disrupting and transforming classic communications models and ecosystems. In his session at @ThingsExpo, Erik Perotti, Senior Manager of New Ventures on Plantronics’ Innovation team, provided an overview of this technological shift, including associated business and consumer communications impacts, and opportunities it m...
Jan. 21, 2017 02:00 AM EST Reads: 5,814
Manufacturers are embracing the Industrial Internet the same way consumers are leveraging Fitbits – to improve overall health and wellness. Both can provide consistent measurement, visibility, and suggest performance improvements customized to help reach goals. Fitbit users can view real-time data and make adjustments to increase their activity. In his session at @ThingsExpo, Mark Bernardo Professional Services Leader, Americas, at GE Digital, discussed how leveraging the Industrial Internet and...
Jan. 21, 2017 01:30 AM EST Reads: 6,566
"Tintri was started in 2008 with the express purpose of building a storage appliance that is ideal for virtualized environments. We support a lot of different hypervisor platforms from VMware to OpenStack to Hyper-V," explained Dan Florea, Director of Product Management at Tintri, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Jan. 21, 2017 01:15 AM EST Reads: 4,900
There will be new vendors providing applications, middleware, and connected devices to support the thriving IoT ecosystem. This essentially means that electronic device manufacturers will also be in the software business. Many will be new to building embedded software or robust software. This creates an increased importance on software quality, particularly within the Industrial Internet of Things where business-critical applications are becoming dependent on products controlled by software. Qua...
Jan. 21, 2017 01:15 AM EST Reads: 5,050
Fact is, enterprises have significant legacy voice infrastructure that’s costly to replace with pure IP solutions. How can we bring this analog infrastructure into our shiny new cloud applications? There are proven methods to bind both legacy voice applications and traditional PSTN audio into cloud-based applications and services at a carrier scale. Some of the most successful implementations leverage WebRTC, WebSockets, SIP and other open source technologies. In his session at @ThingsExpo, Da...
Jan. 21, 2017 01:15 AM EST Reads: 2,885
A critical component of any IoT project is what to do with all the data being generated. This data needs to be captured, processed, structured, and stored in a way to facilitate different kinds of queries. Traditional data warehouse and analytical systems are mature technologies that can be used to handle certain kinds of queries, but they are not always well suited to many problems, particularly when there is a need for real-time insights.
Jan. 21, 2017 12:15 AM EST Reads: 6,375
In his General Session at 16th Cloud Expo, David Shacochis, host of The Hybrid IT Files podcast and Vice President at CenturyLink, investigated three key trends of the “gigabit economy" though the story of a Fortune 500 communications company in transformation. Narrating how multi-modal hybrid IT, service automation, and agile delivery all intersect, he will cover the role of storytelling and empathy in achieving strategic alignment between the enterprise and its information technology.
Jan. 21, 2017 12:00 AM EST Reads: 4,709
IoT is at the core or many Digital Transformation initiatives with the goal of re-inventing a company's business model. We all agree that collecting relevant IoT data will result in massive amounts of data needing to be stored. However, with the rapid development of IoT devices and ongoing business model transformation, we are not able to predict the volume and growth of IoT data. And with the lack of IoT history, traditional methods of IT and infrastructure planning based on the past do not app...
Jan. 20, 2017 10:45 PM EST Reads: 928
WebRTC is bringing significant change to the communications landscape that will bridge the worlds of web and telephony, making the Internet the new standard for communications. Cloud9 took the road less traveled and used WebRTC to create a downloadable enterprise-grade communications platform that is changing the communication dynamic in the financial sector. In his session at @ThingsExpo, Leo Papadopoulos, CTO of Cloud9, discussed the importance of WebRTC and how it enables companies to focus o...
Jan. 20, 2017 08:45 PM EST Reads: 4,390
The Internet of Things can drive efficiency for airlines and airports. In their session at @ThingsExpo, Shyam Varan Nath, Principal Architect with GE, and Sudip Majumder, senior director of development at Oracle, discussed the technical details of the connected airline baggage and related social media solutions. These IoT applications will enhance travelers' journey experience and drive efficiency for the airlines and the airports.
Jan. 20, 2017 05:45 PM EST Reads: 2,104
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo 2016 in New York. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place June 6-8, 2017, at the Javits Center in New York City, New York, is co-located with 20th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry p...
Jan. 20, 2017 05:15 PM EST Reads: 3,827
"LinearHub provides smart video conferencing, which is the Roundee service, and we archive all the video conferences and we also provide the transcript," stated Sunghyuk Kim, CEO of LinearHub, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Jan. 20, 2017 03:00 PM EST Reads: 1,663
Things are changing so quickly in IoT that it would take a wizard to predict which ecosystem will gain the most traction. In order for IoT to reach its potential, smart devices must be able to work together. Today, there are a slew of interoperability standards being promoted by big names to make this happen: HomeKit, Brillo and Alljoyn. In his session at @ThingsExpo, Adam Justice, vice president and general manager of Grid Connect, will review what happens when smart devices don’t work togethe...
Jan. 20, 2017 02:15 PM EST Reads: 646
"There's a growing demand from users for things to be faster. When you think about all the transactions or interactions users will have with your product and everything that is between those transactions and interactions - what drives us at Catchpoint Systems is the idea to measure that and to analyze it," explained Leo Vasiliou, Director of Web Performance Engineering at Catchpoint Systems, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York Ci...
Jan. 20, 2017 01:30 PM EST Reads: 5,748
The 20th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held June 6-8, 2017, at the Javits Center in New York City, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Containers, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportunity. Submit your speaking proposal ...
Jan. 20, 2017 01:30 PM EST Reads: 5,255
WebRTC is the future of browser-to-browser communications, and continues to make inroads into the traditional, difficult, plug-in web communications world. The 6th WebRTC Summit continues our tradition of delivering the latest and greatest presentations within the world of WebRTC. Topics include voice calling, video chat, P2P file sharing, and use cases that have already leveraged the power and convenience of WebRTC.
Jan. 20, 2017 12:30 PM EST Reads: 3,205
Discover top technologies and tools all under one roof at April 24–28, 2017, at the Westin San Diego in San Diego, CA. Explore the Mobile Dev + Test and IoT Dev + Test Expo and enjoy all of these unique opportunities: The latest solutions, technologies, and tools in mobile or IoT software development and testing. Meet one-on-one with representatives from some of today's most innovative organizations
Jan. 20, 2017 12:30 PM EST Reads: 1,668
20th Cloud Expo, taking place June 6-8, 2017, at the Javits Center in New York City, NY, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy.
Jan. 20, 2017 12:30 PM EST Reads: 4,360
SYS-CON Events announced today that Super Micro Computer, Inc., a global leader in Embedded and IoT solutions, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 7-9, 2017, at the Javits Center in New York City, NY. Supermicro (NASDAQ: SMCI), the leading innovator in high-performance, high-efficiency server technology, is a premier provider of advanced server Building Block Solutions® for Data Center, Cloud Computing, Enterprise IT, Hadoop/Big Data, HPC and E...
Jan. 20, 2017 12:15 PM EST Reads: 5,847