S&P Positive on Cableuropa

LONDON -- Standard & Poor's Ratings Services said today it revised its outlook on Spanish cable operator Cableuropa S.A.U. to positive from stable, following the group's continuing operating progress and proposed refinancing.

At the same time, Standard & Poor's affirmed its 'CCC+' long-term corporate credit rating on Cableuropa and its 'CCC-' senior unsecured debt rating on related entity ONO Finance PLC.

The rating actions follow the company's announcement on April 16, 2004, of a tender offer for up to €300 million ($358 million) principal amount of its outstanding notes subject to obtaining the related financing through an offering of senior debt securities. Pro forma for the refinancing, Cableuropa's total debt at Dec. 31, 2003, would be €1.1 billion.

"The rating actions reflect Cableuropa's continuing operating and financial progress and proactive stance to strengthen its balance sheet and liquidity through the proposed bond buyback and refinancing transactions," said Standard & Poor's credit analyst Leandro de Torres Zabala. "The company will remain challenged, however, to grow into its over-leveraged capital structure and to comply with tightening covenants in the medium term."

The ratings on Cableuropa could be raised over the medium term if the company continues to grow earnings and deleverage, thus improving headroom under its bank covenants, and takes action to improve the equity content of its loans from shareholders (by either capitalizing them and/or extending their maturity beyond the maturity of any new senior debt securities offering).

Complete ratings information is available to subscribers of RatingsDirect, Standard & Poor's Web-based credit analysis system, at www.ratingsdirect.com. They are also available on Standard & Poor's public Web site at www.standardandpoors.com; under Credit Ratings in the left navigation bar, select Credit Ratings Search. Alternatively, call one of the following Standard & Poor's numbers: London Ratings Desk (44) 20-7176-7400; London Press Office Hotline (44) 20-7176-3605; Paris (33) 1-4420-6708; Frankfurt (49) 69-33-999-225; Stockholm (46) 8-440-5916; or Moscow (7) 095-783-4017. Members of the media may also contact the European Press Office via e-mail on: [email protected].