Research Update: U.S. TelePacific Holdings Corp. 'B' Rating Placed On CreditWatch Positive On Acquisition By Pensare

Special purpose acquisition company Pensare Acquisition Corp. announced that it entered into an agreement to acquire Los Angeles-based competitive local exchange carrier U.S. TelePacific Holdings Corp. (d/b/a TPx Communications) in a cash and stock transaction valued at about $1.1 billion. Pensare plans to use proceeds from a proposed private investment in public equity (PIPE) offering to reduce TelePacific's debt. We are placing all of our ratings on TelePacific, including the 'B' issuer credit rating, on CreditWatch with positive implications. The CreditWatch placement reflects the potential for a one-notch upgrade depending on the extent of debt repayment and leverage reduction to the 4x area on a sustained basis. We expect to resolve the CreditWatch placement when the transaction closes and debt

...Special purpose acquisition company Pensare Acquisition Corp. announced that it entered into an agreement to acquire Los Angeles-based competitive local exchange carrier U.S. TelePacific Holdings Corp. (d/b/a TPx Communications) in a cash and stock transaction valued at about $1.1 billion. + Pensare plans to use proceeds from a proposed private investment in public equity (PIPE) offering to reduce TelePacific's debt. + We are placing all of our ratings on TelePacific, including the 'B' issuer credit rating, on CreditWatch with positive implications. + The CreditWatch placement reflects the potential for a one-notch upgrade depending on the extent of debt repayment and leverage reduction to the 4x area on a sustained basis. We expect to resolve the CreditWatch placement when the transaction closes and debt has been repaid....

Research Update