Windstream's spending spree, which will increase its overall debt, appears to have hit a snag as Fitch Ratings has placed the company's credit rating on "Rating Watch Negative."
In the past year, the tier two ILEC has either purchased, or is in the process of purchasing four service providers, including most recently Iowa Telecommunications for $1.1 billion, CLEC Nuvox for $643 million in addition to smaller telcos D&E Communications and Lexcom. Fitch points out that Windstream's net debt will surpass its typical 3.2 to 3.4 times operating cash flow before it sees any savings from integrating operations.
At the same time, Fitch noted that Windstream has a good amount of cash on hand. The service provider currently has $290 in cash and $492 in available credit.
- AP has this article
Windstream adds Iowa Telecommunications to its acquisition cart
Windstream snaps up CLEC NuVox
Windstream wraps up D&E acquisition
Windstream: Waiting to strike? - Sizing up ILEC M&A activity
Sizing up ILEC M&A activity