More bad news for Sprint - junk bond rating from S&P
By Will Park on Monday, May 5th, 2008 at 2:37 PM PST In Announcements, Financial, Sprint
It just doesn’t seem to be getting easier for our favorite No. 3 US wireless provider. Following on their WiMAX-based XOHM network’s launch delay and amid rumors that T-Mobile (NYSE: DT) USA parent Deutsch Telekom is looking to buy up the flagging wireless carrier, Sprint (NYSE: S) has been hit hard with a debt downgrade. Timed coincidentally with the immediate installation of a new CFO, Sprint has seen its credit standing slide from a “BBB-” to a junk-worthy “BB” rating from the Standards & Poor.
Apparently, the S&P sees “Sprint Nextel’s business risk profile is no longer supportive of an investment-grade rating given its deteriorating operating performance and lack of visibility in the wireless business.”
The lowered credit rating is a sign of tough times for the newly appointed CFO. Robert H. Brust will be serving as Sprint’s new financial head-honcho, and it looks like Brust has a lot of work ahead of him. Hopefully, Sprint won’t need to secure additional cash in order to launch its XOHM service. Because, it they do, the new credit rating is going to make it hard to convince people to give Sprint more money.
[Via: RCR News]
