AT&T Inc.'s Proposed Euro Fixed-Rate Reset Perpetual Series B Preferred Shares Rated 'BB+'

NEW YORK (S&P Global Ratings) Feb. 11, 2020--S&P Global Ratings today assigned its 'BB+' issue-level rating to Dallas-based AT&T Inc.'s proposed euro fixed-rate reset perpetual series B preferred shares (amount to be determined). The company will use the proceeds from these shares for general corporate purposes, which we expect will include stock buybacks. We classify the hybrid instrument as having intermediate equity credit (50% equity) until the first reset date, which is five years from the issuance date based on the proposed terms. We rate the shares two notches below our 'BBB' long-term issuer credit rating on the company, which reflects one notch for their subordination relative to AT&T's other debt obligations and an additional notch for their payment flexibility

...February 11, 2020 NEW YORK (S&P Global Ratings) Feb. 11, 2020--S&P Global Ratings today assigned its '##+' issue-level rating to Dallas-based AT&T Inc.'s proposed euro fixed-rate reset perpetual series B preferred shares (amount to be determined). The company will use the proceeds from these shares for general corporate purposes, which we expect will include stock buybacks. We classify the hybrid instrument as having intermediate equity credit (50% equity) until the first reset date, which is five years from the issuance date based on the proposed terms. We rate the shares two notches below our '###' long-term issuer credit rating on the company, which reflects one notch for their subordination relative to AT&T's other debt obligations and an additional notch for their payment flexibility due to the optional deferability of the interest payments. We understand that AT&T plans to increase the stock of hybrids in its capital structure over the next three years to about $20 billion-$30 billion...

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