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Imark
Forumer storico
Secondo distressed exchange per NXP, ed ancora una volta un esito al di sotto delle attese. Ne dà conto Moody's, che postula nel prossimo futuro ulteriori misure di ristrutturazione del debito da parte della società olandese, visto l'esito modesto delle due attuate ad oggi in termini di riduzione del leverage e della consistenza della liquidità disponibile in termini di copertura degli interessi sul debito.
[FONT=verdana,arial,helvetica]Moody's affirms NXP's CFR at Caa2 with a negative outlook upon closing of debt repurchase offer[/FONT]
[FONT=verdana,arial,helvetica]Approximately US$5.5 billion debt securities affected [/FONT]
[FONT=verdana,arial,helvetica]Frankfurt, July 02, 2009 -- Moody's Investors Service today affirmed the Caa2 CFR of NXP Semiconductors' (NXP) on the assumption that the relatively low, $504 million, debt relief gained from its cash offer for notes will be complemented near term by further debt restructuring measures, so that upon completion, NXP's operating performance and credit metrics warrant at least that Caa2 rating. The probability of default rating (PDR) was maintained at Ca, but the LD suffix (Limited Default) was attached reflecting the final closing of NXP's debt exchange transaction. This LD designation will be withdrawn in approximately 3 business days. Moody's affirmed the C ratings for the senior secured and unsecured notes of NXP. The outlook for the ratings remains negative. [/FONT]
[FONT=verdana,arial,helvetica]The cash offer for notes resulted in redemption of $342 million secured notes for an estimated total consideration of about $150 million and of $162 million unsecured notes for approximately $60 million. [/FONT]
[FONT=verdana,arial,helvetica][/FONT]
[FONT=verdana,arial,helvetica]Existing noteholders that elected to participate in the buyback offer accepted principal reductions of between 52.5% and 62.5%, depending upon the class of notes. [/FONT]
[FONT=verdana,arial,helvetica][/FONT]
[FONT=verdana,arial,helvetica]Moody's views the repurchase as a distressed exchange for the particular securities involved, and reflects that a limited default has occurred through the assignment of the probability of default rating of Ca/LD (Limited Default). [/FONT]
[FONT=verdana,arial,helvetica]As a result of the debt repurchase the Issuers' overall indebtedness will be reduced by approximately $504 million and their related interest expense by approximately $32 million. [/FONT]
[FONT=verdana,arial,helvetica][/FONT]
[FONT=verdana,arial,helvetica]Compared to about $6.0 billion debt outstanding before the buyback, the swap produced only a modest improvement in leverage and interest coverage. [/FONT]
[FONT=verdana,arial,helvetica][/FONT]
[FONT=verdana,arial,helvetica]The company's CFR of Caa2 and the Ca/LD PDR as well as its negative rating outlook reflect NXP's very weak credit metrics, and the prospect that further debt restructuring is likely to be pursued over the next several months which could lead to more meaningful de-leveraging.[/FONT]
[FONT=verdana,arial,helvetica][/FONT]
[FONT=verdana,arial,helvetica]Moody's believes that demand for semiconductors may start to stabilize near term, but will continue on a very low level through 2009 given the weak macro-economic conditions currently, and that NXP's operating performance will continue to suffer. Although NXP maintains adequate liquidity, its capital structure appears unsustainable over the medium term unless semiconductor volumes rebound significantly. [/FONT]
[FONT=verdana,arial,helvetica]Issuer: NXP B.V. [/FONT]
[FONT=verdana,arial,helvetica]..Adjustment: [/FONT]
[FONT=verdana,arial,helvetica].... Probability of Default Rating, Adjusted to Ca/LD from Ca [/FONT]
[FONT=verdana,arial,helvetica]NXP's ratings were assigned by evaluating factors we believe are relevant to the credit profile of the issuer, such as i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record and tolerance for risk. [/FONT]
[FONT=verdana,arial,helvetica][/FONT]
[FONT=verdana,arial,helvetica]These attributes were compared against other issuers both within and outside of NXP's core industry and NXP's ratings are believed to be comparable to those of other issuers of similar credit risk.[/FONT]
[FONT=verdana,arial,helvetica]The last rating action for NXP has been on 3 April, 2009, when Moody's affirmed the CFR at Caa2 and downgraded its senior secured notes to C from Caa2.[/FONT]
[FONT=verdana,arial,helvetica]NXP Semiconductors, headquartered in Eindhoven, Netherlands, is a leading semiconductor company, focusing on the designs and manufacture of semiconductors for general applications, power management (Multi-Market) and application-specific integrated circuits for the home electronics, automotive and identification technology application markets. NXP posted sales of USD5.4 billion (including the Mobile & Personal business until the beginning of August 2008) in fiscal year 2008[/FONT]
[FONT=verdana,arial,helvetica]Moody's affirms NXP's CFR at Caa2 with a negative outlook upon closing of debt repurchase offer[/FONT]
[FONT=verdana,arial,helvetica]Frankfurt, July 02, 2009 -- Moody's Investors Service today affirmed the Caa2 CFR of NXP Semiconductors' (NXP) on the assumption that the relatively low, $504 million, debt relief gained from its cash offer for notes will be complemented near term by further debt restructuring measures, so that upon completion, NXP's operating performance and credit metrics warrant at least that Caa2 rating. The probability of default rating (PDR) was maintained at Ca, but the LD suffix (Limited Default) was attached reflecting the final closing of NXP's debt exchange transaction. This LD designation will be withdrawn in approximately 3 business days. Moody's affirmed the C ratings for the senior secured and unsecured notes of NXP. The outlook for the ratings remains negative. [/FONT]
[FONT=verdana,arial,helvetica]The cash offer for notes resulted in redemption of $342 million secured notes for an estimated total consideration of about $150 million and of $162 million unsecured notes for approximately $60 million. [/FONT]
[FONT=verdana,arial,helvetica][/FONT]
[FONT=verdana,arial,helvetica]Existing noteholders that elected to participate in the buyback offer accepted principal reductions of between 52.5% and 62.5%, depending upon the class of notes. [/FONT]
[FONT=verdana,arial,helvetica][/FONT]
[FONT=verdana,arial,helvetica]Moody's views the repurchase as a distressed exchange for the particular securities involved, and reflects that a limited default has occurred through the assignment of the probability of default rating of Ca/LD (Limited Default). [/FONT]
[FONT=verdana,arial,helvetica]As a result of the debt repurchase the Issuers' overall indebtedness will be reduced by approximately $504 million and their related interest expense by approximately $32 million. [/FONT]
[FONT=verdana,arial,helvetica][/FONT]
[FONT=verdana,arial,helvetica]Compared to about $6.0 billion debt outstanding before the buyback, the swap produced only a modest improvement in leverage and interest coverage. [/FONT]
[FONT=verdana,arial,helvetica][/FONT]
[FONT=verdana,arial,helvetica]The company's CFR of Caa2 and the Ca/LD PDR as well as its negative rating outlook reflect NXP's very weak credit metrics, and the prospect that further debt restructuring is likely to be pursued over the next several months which could lead to more meaningful de-leveraging.[/FONT]
[FONT=verdana,arial,helvetica][/FONT]
[FONT=verdana,arial,helvetica]Moody's believes that demand for semiconductors may start to stabilize near term, but will continue on a very low level through 2009 given the weak macro-economic conditions currently, and that NXP's operating performance will continue to suffer. Although NXP maintains adequate liquidity, its capital structure appears unsustainable over the medium term unless semiconductor volumes rebound significantly. [/FONT]
[FONT=verdana,arial,helvetica]Issuer: NXP B.V. [/FONT]
[FONT=verdana,arial,helvetica]..Adjustment: [/FONT]
[FONT=verdana,arial,helvetica].... Probability of Default Rating, Adjusted to Ca/LD from Ca [/FONT]
[FONT=verdana,arial,helvetica]NXP's ratings were assigned by evaluating factors we believe are relevant to the credit profile of the issuer, such as i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record and tolerance for risk. [/FONT]
[FONT=verdana,arial,helvetica][/FONT]
[FONT=verdana,arial,helvetica]These attributes were compared against other issuers both within and outside of NXP's core industry and NXP's ratings are believed to be comparable to those of other issuers of similar credit risk.[/FONT]
[FONT=verdana,arial,helvetica]The last rating action for NXP has been on 3 April, 2009, when Moody's affirmed the CFR at Caa2 and downgraded its senior secured notes to C from Caa2.[/FONT]
[FONT=verdana,arial,helvetica]NXP Semiconductors, headquartered in Eindhoven, Netherlands, is a leading semiconductor company, focusing on the designs and manufacture of semiconductors for general applications, power management (Multi-Market) and application-specific integrated circuits for the home electronics, automotive and identification technology application markets. NXP posted sales of USD5.4 billion (including the Mobile & Personal business until the beginning of August 2008) in fiscal year 2008[/FONT]
Imark
Forumer storico
Anche S&P si pronuncia sul completamento del secondo distressed exchange varato da NXP, se la situazione del consumo di cassa non peggiora, si capisce che nelle condizioni attuali potrebbe aver guadagnato alcuni mesi. Peraltro ulteriori offerte di distressed exchanges non sono escluse dall'agenzia.
[FONT=Arial, Helvetica, sans-serif]Dutch Semiconductor Manufacturer NXP B.V. Upgraded To 'CCC' After Debt Exchange; Outlook Negative[/FONT]
PARIS (Standard & Poor's) July 15, 2009--Standard & Poor's Ratings Services said today it has raised its long-term corporate credit rating on Dutch semiconductor manufacturer NXP B.V. to 'CCC' from 'SD' (selective default). The outlook is negative.
At the same time, we raised the issue ratings on NXP and subsidiary NXP Funding LLC's secured notes to 'CCC' from 'D'. The recovery rating on these notes is unchanged at '4', indicating our expectation of average (30%-50%) recovery in the event of a payment default.
We raised the ratings on NXP and NXP Funding's unsecured notes to 'CCC-' from 'D'. The recovery rating of '5' on these notes remains unchanged, indicating our expectation of modest (10%-30%) recovery in the event of a payment default.
The issue ratings on NXP and NXP Funding's super-priority €500 million revolving credit facility due 2012 and super-priority notes due 2013 were raised to 'B-' from 'CCC'. The recovery ratings on these super-priority facility and notes are unchanged at '1', indicating our expectation of very high (90%-100%) recovery in the event of a payment default.
"The ratings primarily reflect our assessment of NXP's capital structure and financial risk profile as highly leveraged following NXP's recently completed distressed cash exchange for its senior unsecured and senior secured notes," said Standard & Poor's credit analyst Patrice Cochelin. "Also integrated into the ratings is our view that NXP's liquidity is somewhat weaker than before completing the cash exchange."
At March 31, 2009, NXP reported consolidated gross debt of $6.4 billion, including $0.6 billion drawn under its revolving credit facility. We estimate that the recent cash offer and a debt exchange offer completed in April 2009 reduced gross debt to about $5.6 billion at current exchange rates, excluding any changes in the revolver draw.
According to NXP, the cash offer will reduce NXP's debt by $504 million, resulting in a cut in annual interest charges equivalent to $32 million. Although NXP has not disclosed how much it will pay in total for its cash offer, we calculate the amount at slightly above $200 million. In total, excluding currency impacts and including a $600 million revolver draw, we
estimate that NXP has reduced its gross debt burden by 15% through its two offers. NXP has not ruled out further debt exchanges or buybacks in the future.
We therefore continue to assess NXP's financial risk profile as highly leveraged. Because of our expectation of continued negative free operating cash flow (FOCF) generation for NXP in 2009--despite a somewhat lower interest burden--refinancing risks for NXP's debt maturities from 2012 remain a rating constraint.
Over the near term, these risks are partially offset by our expectation of a moderate demand pick-up in second-quarter 2009 and our assessment of NXP's liquidity as adequate, although weakening. NXP's most recent guidance calls for sequential revenue growth in the higher end of the company's previous 10%-25% range, excluding wafer sales and at constant currencies.
"The negative outlook primarily reflects our view that tough economic conditions and large cash outlays for restructuring and interest payments will likely continue to trigger cash burn at NXP in the foreseeable future," said Mr. Cochelin. "In addition, we believe that the moderate debt reduction NXP achieved through the recent debt exchanges has not addressed questions about the medium-term sustainability of NXP's capital structure."
We therefore consider that NXP carries a relatively high risk of additional below-par capital structure transactions and, ultimately, faces high hurdles to refinance its revolver in 2012 and notes starting from 2013.
A dramatic reduction in NXP's cash burn while maintaining adequate cash balances could support rating stability, however
- Dutch chip manufacturer NXP B.V. recently completed two distressed exchanges; the latest cash exchange used some of NXP's liquidity sources.
- We view NXP's capital structure and financial profile as highly levered, and we assess NXP's liquidity as adequate for the near term but see potential weakening further out.
- We are raising the long-term rating on NXP to 'CCC', with a negative outlook. All recovery ratings remain unchanged.
- The negative outlook primarily reflects our view that tough economic conditions and large cash outlays for restructuring and interest payments will likely continue to trigger cash burn at NXP in the foreseeable future.
PARIS (Standard & Poor's) July 15, 2009--Standard & Poor's Ratings Services said today it has raised its long-term corporate credit rating on Dutch semiconductor manufacturer NXP B.V. to 'CCC' from 'SD' (selective default). The outlook is negative.
At the same time, we raised the issue ratings on NXP and subsidiary NXP Funding LLC's secured notes to 'CCC' from 'D'. The recovery rating on these notes is unchanged at '4', indicating our expectation of average (30%-50%) recovery in the event of a payment default.
We raised the ratings on NXP and NXP Funding's unsecured notes to 'CCC-' from 'D'. The recovery rating of '5' on these notes remains unchanged, indicating our expectation of modest (10%-30%) recovery in the event of a payment default.
The issue ratings on NXP and NXP Funding's super-priority €500 million revolving credit facility due 2012 and super-priority notes due 2013 were raised to 'B-' from 'CCC'. The recovery ratings on these super-priority facility and notes are unchanged at '1', indicating our expectation of very high (90%-100%) recovery in the event of a payment default.
"The ratings primarily reflect our assessment of NXP's capital structure and financial risk profile as highly leveraged following NXP's recently completed distressed cash exchange for its senior unsecured and senior secured notes," said Standard & Poor's credit analyst Patrice Cochelin. "Also integrated into the ratings is our view that NXP's liquidity is somewhat weaker than before completing the cash exchange."
At March 31, 2009, NXP reported consolidated gross debt of $6.4 billion, including $0.6 billion drawn under its revolving credit facility. We estimate that the recent cash offer and a debt exchange offer completed in April 2009 reduced gross debt to about $5.6 billion at current exchange rates, excluding any changes in the revolver draw.
According to NXP, the cash offer will reduce NXP's debt by $504 million, resulting in a cut in annual interest charges equivalent to $32 million. Although NXP has not disclosed how much it will pay in total for its cash offer, we calculate the amount at slightly above $200 million. In total, excluding currency impacts and including a $600 million revolver draw, we
estimate that NXP has reduced its gross debt burden by 15% through its two offers. NXP has not ruled out further debt exchanges or buybacks in the future.
We therefore continue to assess NXP's financial risk profile as highly leveraged. Because of our expectation of continued negative free operating cash flow (FOCF) generation for NXP in 2009--despite a somewhat lower interest burden--refinancing risks for NXP's debt maturities from 2012 remain a rating constraint.
Over the near term, these risks are partially offset by our expectation of a moderate demand pick-up in second-quarter 2009 and our assessment of NXP's liquidity as adequate, although weakening. NXP's most recent guidance calls for sequential revenue growth in the higher end of the company's previous 10%-25% range, excluding wafer sales and at constant currencies.
"The negative outlook primarily reflects our view that tough economic conditions and large cash outlays for restructuring and interest payments will likely continue to trigger cash burn at NXP in the foreseeable future," said Mr. Cochelin. "In addition, we believe that the moderate debt reduction NXP achieved through the recent debt exchanges has not addressed questions about the medium-term sustainability of NXP's capital structure."
We therefore consider that NXP carries a relatively high risk of additional below-par capital structure transactions and, ultimately, faces high hurdles to refinance its revolver in 2012 and notes starting from 2013.
A dramatic reduction in NXP's cash burn while maintaining adequate cash balances could support rating stability, however
METHOS
Forumer storico
NXP da segnali di vita...
http://www.reuters.com/article/rbssTechMediaTelecomNews/idUSLO72781420090724
http://www.reuters.com/article/rbssTechMediaTelecomNews/idUSLO72781420090724
Imark
Forumer storico
A conti fatti da S&P, il debito di NXP risulta ridotto del 18% dopo gli swap distressed attuati dal produttore di chip. Lo stato dell'arte al momento, secondo l'agenzia.
[FONT=Arial, Helvetica, sans-serif]NXP B.V. Long-Term 'CCC' Rating Affirmed; Outlook Negative; Ratings On Notes Lowered To 'CC'; Notes On Watch Negative[/FONT]
At the same time we are lowering, and placing on CreditWatch with negative implications, the issue ratings on NXP and subsidiary NXP Funding LLC' s senior unsecured and senior secured notes. These issues have been subject to
several exchanges by NXP, which qualify as distressed under our criteria.
On completion of the latest exchange, which NXP has said could occur on July 23, 2009, we expect to lower the ratings on these debt issues to 'D' (default). Shortly thereafter, we expect to raise the issue ratings on these debt issues back to 'CC', reflecting the risk we see that there may be further exchange offers. All other issue ratings are affirmed and are not placed on CreditWatch.
"The ratings primarily reflect our assessment of NXP's capital structure and financial risk profile as highly leveraged following NXP's recent distressed exchanges for its senior unsecured and senior secured notes," said Standard & Poor's credit analyst Patrice Cochelin.
Some of these exchange offers have been completed, others have been announced and completion is pending We calculate that the latest exchanges should have a net $26 million negative impact on NXP's cash balances. In total, excluding currency impacts and including a $600 million revolver draw, we estimate that NXP has reduced its gross debt burden by 18% through its various exchanges.
NXP has not ruled out further debt exchanges or buybacks in the future.
The CreditWatch placement on NXP's senior unsecured and senior secured notes reflects our expectation that the ratings on these notes will be lowered to 'D' (default) on completion of NXP's exchange. NXP has indicated that it
expects the exchange to complete on July 23, 2009. Shortly thereafter, we expect to raise the ratings on the senior secured notes and senior unsecured notes to 'CC' to reflect the risk of further exchange offers, in line with our criteria for distressed exchanges.
- Dutch chip manufacturer NXP B.V. recently announced distressed exchanges.
- These transactions do not materially impact our assessment of NXP's leverage or liquidity.
- In line with our criteria on distressed exchanges, and in particular on multiple transactions, we are lowering the ratings on the company's secured and unsecured notes to 'CC' and placing them on CreditWatch negative. We are affirming the remaining notes at 'B-'. We are affirming the 'CCC' long-term corporate credit rating.
- The negative outlook on the corporate credit rating reflects a still highly leveraged capital structure and risks of further depletion of liquidity, in our view.
At the same time we are lowering, and placing on CreditWatch with negative implications, the issue ratings on NXP and subsidiary NXP Funding LLC' s senior unsecured and senior secured notes. These issues have been subject to
several exchanges by NXP, which qualify as distressed under our criteria.
On completion of the latest exchange, which NXP has said could occur on July 23, 2009, we expect to lower the ratings on these debt issues to 'D' (default). Shortly thereafter, we expect to raise the issue ratings on these debt issues back to 'CC', reflecting the risk we see that there may be further exchange offers. All other issue ratings are affirmed and are not placed on CreditWatch.
"The ratings primarily reflect our assessment of NXP's capital structure and financial risk profile as highly leveraged following NXP's recent distressed exchanges for its senior unsecured and senior secured notes," said Standard & Poor's credit analyst Patrice Cochelin.
Some of these exchange offers have been completed, others have been announced and completion is pending We calculate that the latest exchanges should have a net $26 million negative impact on NXP's cash balances. In total, excluding currency impacts and including a $600 million revolver draw, we estimate that NXP has reduced its gross debt burden by 18% through its various exchanges.
NXP has not ruled out further debt exchanges or buybacks in the future.
The CreditWatch placement on NXP's senior unsecured and senior secured notes reflects our expectation that the ratings on these notes will be lowered to 'D' (default) on completion of NXP's exchange. NXP has indicated that it
expects the exchange to complete on July 23, 2009. Shortly thereafter, we expect to raise the ratings on the senior secured notes and senior unsecured notes to 'CC' to reflect the risk of further exchange offers, in line with our criteria for distressed exchanges.