MetroNet Holdings LLC Assigned 'B-' Rating, Outlook Stable; First-Lien Debt Rated 'B', Second-Lien Debt Rated 'CCC'

MetroNet Holdings LLC (MetroNet) plans to raise $380 million of new debt to refinance existing debt and fund investment in newer markets resulting in consolidated leverage of about 15x in fiscal 2019. We are assigning a 'B-' issuer credit rating and stable outlook to MetroNet Holdings LLC to reflect the elevated leverage and cash flow deficits associated with entering new markets, while also factoring in a track record of successful execution. We are also assigning a 'B' issue-level rating and '2' recovery rating to the proposed secured first-lien credit facilities reflecting value from earnings in mature markets and fiber assets in developing markets. At the same time, we are assigning a 'CCC' issue-level rating and '6' recovery rating to the

...+ MetroNet Holdings LLC (MetroNet) plans to raise $380 million of new debt to refinance existing debt and fund investment in newer markets resulting in consolidated leverage of about 15x in fiscal 2019. + We are assigning a 'B-' issuer credit rating and stable outlook to MetroNet Holdings LLC to reflect the elevated leverage and cash flow deficits associated with entering new markets, while also factoring in a track record of successful execution. + We are also assigning a 'B' issue-level rating and '2' recovery rating to the proposed secured first-lien credit facilities reflecting value from earnings in mature markets and fiber assets in developing markets. At the same time, we are assigning a '###' issue-level rating and '6' recovery rating to the second-lien to reflect expectations for minimal recovery. + The stable outlook reflects our belief that MetroNet will be able to significantly reduce leverage through earnings growth over the next year as the company expands into new markets...

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