New York, October 05, 2016 -- Moody's Investors Service, ("Moody's") said that Communications, Sales & Leasing, Inc.'s ("CSAL" or "the company") proposal to amend its senior secured credit agreement and subsequent reorganization to an "up-REIT" structure will not immediately affect its B2 corporate family rating. The proposed transaction would allow the company to create a limited partnership (LP) subsidiary which would become a co-obligor under the amended credit agreement. Under the proposed restructuring, the new LP would issue equity units to finance potential future acquisitions. This is a tax-efficient strategy which allows target companies to become equity holders in the LP and defer the tax impact of a sale. LP unit holders can elect to convert units into common equity in CSAL or cash (at the option of CSAL) at any time and LP unit holders will receive cash dividends. Moody's views the proposed transaction favorably as it signals that CSAL will continue to use equity to finance acquisitions. M&A is CSAL's primary strategy for growth and to diversify its business away from its main tenant, Windstream (Windstream Services, LLC B1 stable). With leverage already near the upper limits of its B2 rating, issuing equity to finance transactions will help CSAL grow and maintain its current ratings.

Vollständigen Artikel bei Moodys lesen