S&P Gives Japan Telecom an A

LONDON -- Standard & Poor's Ratings Services said today it assigned its single-'A' long-term corporate credit rating to Japan Telecom Holding Co. Ltd. (Japan Telecom), a 66.7% owned subsidiary of global mobile operator Vodafone Group PLC (Vodafone; A/Stable/A-1), and holding company for Vodafone's Japanese mobile and fixed-line telecommunications interests.At the same time, Standard & Poor's assigned its single-'A' senior unsecured debt rating to the outstanding bonds issued by Japan Telecom. The outlook is stable."The ratings on Japan Telecom have been equalized with those on Vodafone in view of the strategic importance to Vodafone of Japan Telecom, which controls the J-Phone Group, the number-two operator in the Japanese mobile market," said Peter Kernan, head of Standard & Poor's European telecoms group. "Furthermore, the ratings on Japan Telecom are likely to move in step with those of its parent for as long as Japan Telecom is regarded as a strategically important investment for Vodafone," added Mr. Kernan. Japan Telecom is fully consolidated by Vodafone, and the company's strategy and financial policy are expected to continue to be driven by Vodafone.The ratings on Vodafone are underpinned by the group's industry-leading scale and the strong market positions of its key controlled business units in Germany, Italy, the U.K., and Japan, which have translated into continued strong operational performance and credit protection measures. The Vodafone ratings are also supported by the group's adherence to a consistently conservative financial policy. Despite its heavy investment in acquisitions and third-generation (3G) licenses, the group has, unlike many of its peers, prudently funded itself by using equity proceeds and noncore asset disposals to partly finance investment. This conservatism is reflected in the group's relatively strong credit metrics.Japan TelecomStandard & Poor’s