Standard & Poor's Ratings Services said today that its ratings and outlook on Qatar Telecom (Qtel) Q.S.C. (A/Stable/A-1), incumbent fixed-line and mobile telecoms operator in the State of Qatar (AA/Stable/A-1+), are not affected by Qtel's announced signing of an agreement with a consortium led by Tunisian Princesse Holding to acquire from Orascom Telecom Holdings S.A.E. (B-/Watch Pos/--) Orascom's 50% stake in mobile operator Orascom Telecom Tunisie S.A. (Tunisiana) for about $1.2 billion cash.
Tunisiana leads among Tunisia's mobile operators and on June 30, 2009, had a 52.9% subscriber market share. Orascom and Qtel's 52.5% subsidiary National Mobile Telecommunications Company K.S.C. operate Tunisiana.
Our pro-forma calculations show Qtel's adjusted debt to EBITDA for the 12 months ended June 30, 2010, would have been 2.7x, which is still commensurate with the ratings. This includes the full consolidation of Tunisiana in Qtel's financial statements and an increase in adjusted debt to reflect the proposed $1.2 billion cash consideration. Ratings stability depends on consolidated adjusted funds from operations to debt remaining above 25% and adjusted consolidated debt to EBITDA remaining at less than 3.0x.