Axtel Sees Rating Reductions

Mexican telecommunications company Axtel has had its ratings lowered by S&P and Moody’s, according to each agency. S&P dropped its corporate credit rating to B from B+. It points to competition and marginal revenue growth, as well as the expectation that Axtel will continue seeing free operating cash flow deficits due to its capital expenditure program, as part of the rationale behind the reduction. The outlook is stable. Moody’s, meanwhile, downgraded Axtel to Caa1 from B3. Moody’s notes that Axtel faces a challenging competitive environment and a tight liquidity position. The outlook is negative.