S&P Cuts Kyivstar GSM

LONDON -- Standard & Poor's Ratings Services said today it assigned its single-'B'-minus long-term corporate credit rating to Ukraine-based mobile telecommunications operator CJSC Kyivstar GSM (Kyivstar). The outlook is stable.

At the same time, Standard & Poor's assigned its single-'B'-minus rating to Kyivstar's $150 million-$200 million proposed loan participation notes to be issued by Dresdner Bank AG (AA-/Watch Neg/A-1+), for the sole purpose of funding an intended loan of similar amount to Kyivstar. The ratings and outlook assume that the note issue proceeds.

"The ratings are driven by Kyivstar's strong market position as one of two leading mobile phone operators in Ukraine (B/Stable/B), with a subscriber market share of about 49.3% at Aug. 31, 2002," said Standard & Poor's credit analyst Michael O'Brien. "This includes potential further growth in subscriber numbers, based on recent past and expected future growth of the Ukrainian economy."

Furthermore, the company has posted solid financial and operational performance to date in a market environment that poses significant challenges, and receives operational support from majority shareholder Telenor ASA (Nasdaq: TELN) (A-/Stable/A-2).

Kyivstar GSMStandard & Poor’s