Oman Telecommunications Company S.A.O.G.: Update following the change of outlook to stable - Moody's Global Credit Research

Oman Telecommunications Company S.A.O.G.: Update following the change of outlook to stable

Oman Telecommunications Company S.A.O.G.: Update following the change of outlook to stable - Moody's Global Credit Research
Oman Telecommunications Company S.A.O.G.: Update following the change of outlook to stable
Published Oct 20, 2021
13 pages (6360 words) — Published Oct 20, 2021
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Brief Excerpt:

...On 19 October 2021, we affirmed Oman Telecommunications Company S.A.O.G.'s (Omantel) Ba3 Corporate Family Rating (CFR) and changed the outlook to stable from negative, a direct consequence of a similar action on the rating of the Government of Oman. The rating action reflects the strong credit linkages between the Government of Oman and Omantel. This is further reflected in the company's status as a government related issuer with operations concentrated in Oman and whose performance will depend greatly on the local economic developments. Omantel's CFR reflects the company's standalone creditworthiness, as expressed by its baseline credit assessment (BCA) of ba3, as well as its high dependence and moderate level of support from the Government of Oman (Ba3 stable), given the government's 51% stake in the company. Omantel's BCA remains on par with the rating of the Government of Oman and reflects the company's (1) dominant market position in the Omani telecommunications market; (2) resilient...

  
Report Type:

Credit Opinion

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Oman Telecommunications Company S.A.O.G.
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Oman Telecommunications Company S.A.O.G.: Update to key credit factors - Credit Opinion – 2021/06/28 – US$ 250.00 – ...Omantel's CFR reflects the company's standalone creditworthiness, as expressed by its baseline credit assessment (BCA) of ba3, as well as its high dependence and moderate level of support from the Government of Oman (Ba3 Negative), given the government's 51% stake in the company. Omantel's BCA remains on par with the rating of the Government of Oman and reflects the company's (1) dominant market position in the Omani telecommunications market; (2) resilient, although slightly weakening, operating performance, supported by the necessity- like consumer spending on telecommunications services despite the slowdown in Oman's economy; (3) high EBITDA margin of above 50%; and (4) good liquidity. The BCA also takes into account (1) the potential pressure on Omantel's revenue and cash flow following the introduction of a third mobile operator in Oman, (2) the company's increased leverage following the Mobile Telecommunications K.S.C.P (Zain) acquisition in 2017, and (3) the concentration of Omantel's...

Oman Telecommunications Company S.A.O.G.: Tower sales is credit positive - Issuer Comment – 2021/05/17 – US$ 200.00 – ...On 11 May 2021, Oman Telecommunications Company S.A.O.G (Omantel) announced that it entered into an agreement to sell its passive mobile tower infrastructure assets to Helios Towers plc (B2 stable) for a total cash consideration of $575 million. Omantel will subsequently enter into a long term master service agreement to continue to use the towers and will use the cash proceeds to repay debt. The transaction is credit positive for Omantel, because it will result in a reduction of leverage once the transaction is completed as well as a reduction in capex over time. Under the agreement, Omantel will sell 2,890 towers in Oman to Helios Towers and will enter into a lease and service contract for a period of 15 years with renewal options. As part of the agreement, Helios Towers has also committed to build a minimum of 300 additional new towers over the next 7 years. This will result in a decrease in Omantel's capex over the medium term as the company will be reducing its passive infrastructure...

Oman Telecommunications Company S.A.O.G. - September 2020 (LTM): Peer Snapshot - Peer Snapshot – 2021/01/19 – US$ 750.00 – ¬ 2021 Moody's Corporation, Moody's Investors Service, Inc., Moody's Analytics, Inc. and/or their licensors and affiliates (collectively, "MOODY'S"). All rights reserved. CREDIT RATINGS ISSUED BY MOODY'S CREDIT RATINGS AFFILIATES ARE...

Oman Telecommunications Company S.A.O.G.: Oman awards license to third mobile operator, a credit negative for Omantel - Issuer Comment – 2021/01/07 – US$ 200.00 – ...On 5 January, the Sultan of Oman, His Majesty Sultan Haitham Bin Tarik, issued a royal decree (No. 4/2021) granting a first class license to Oman Future Telecommunications Company (OFT), making it the third mobile operator in Oman, in addition to Oman Telecommunications Company S.A.O.G. (Omantel, Ba3 negative) and Ooredoo Oman. The move is credit negative for Omantel because a third operator will increase competition in the Omani market and dent Omantel's revenue and cash flow generation in an already difficult operating environment. OFT, which signed a strategic agreement with Vodafone Group Plc (Baa2 negative), will roll out a new mobile network and a number of other telecommunication services under the Vodafone brand in Oman. We expect the new operator to start providing services during 2021 now that the license has been granted. We also expect the third operator to tap into the existing customer bases of Omantel and Ooredoo Oman in a shrinking domestic mobile market, decreasing their...

Oman Telecommunications Company S.A.O.G. - June 2020 (LTM): Peer Snapshot - Peer Snapshot – 2020/11/05 – US$ 750.00 – ¬ 2020 Moody's Corporation, Moody's Investors Service, Inc., Moody's Analytics, Inc. and/or their licensors and affiliates (collectively, "MOODY'S"). All rights reserved. CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. AND/OR...

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MLA:
Moody's Global Credit Research. "Oman Telecommunications Company S.A.O.G.: Update following the change of outlook to stable" Oct 20, 2021. Alacra Store. Nov 30, 2021. <http://www.alacrastore.com/moodys-credit-research/Oman-Telecommunications-Company-S-A-O-G-Update-following-the-change-of-outlook-to-stable-PBC_1304637>
  
APA:
Moody's Global Credit Research. (). Oman Telecommunications Company S.A.O.G.: Update following the change of outlook to stable Oct 20, 2021. New York, NY: Alacra Store. Retrieved Nov 30, 2021 from <http://www.alacrastore.com/moodys-credit-research/Oman-Telecommunications-Company-S-A-O-G-Update-following-the-change-of-outlook-to-stable-PBC_1304637>
  
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