Moody's to review Sprint ratings for downgrade

By Associated Press May 16, 2008 Comments (0)

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Moody's Investors Service said Friday it has placed Sprint Nextel Corp.'s "Baa3" senior unsecured long-term debt rating and its "Prime-3" short term debt rating on review for a possible downgrade.

A "Baa3" rating is investment grade, but anything lower is not.

The beleaguered wireless carrier has plagued by customer losses and on Monday posted a larger first-quarter loss, hurt by lower sales, severance charges and the loss of more than a million monthly subscribers.

The ratings agency said the review was prompted by concerns over slowing subscriber growth and stiff competition, which may hurt Sprint's ability to restore the health of its business and generate enough free cash flow.

About $24 Billion of debt is affected.

Overland Park, Kan.-based Sprint's shares fell 20 cents, or 2.1 percent, to $9.20 in midday trading.

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