S&P Global released a report downgrading Cell C to D (Default), while its rating of Cell C's senior secured bonds are now rated at Default (D).
The suspension of interest payments in July is part of the wider Cell C initiatives to improve liquidity and to restructure the company's balance sheet. Cell C continues to work proactively with all stakeholders to improve its liquidity, debt profile and long-term competitiveness as part of its strategic road map.
As announced earlier this month (7 August), Cell C has entered into a term sheet to expand the provisions of its roaming agreement with MTN, to better control its capital expenditure and operating costs. An agreement will lay the groundwork for a broader national roaming agreement, supporting South Africa's policy goals of avoiding network duplication. The network services provided will drive efficiencies in the delivery of services to its consumers by Cell C.
The expanded roaming agreement together with the recapitalization transaction will advance Cell C's path to sustainability.
Cell C CEO, Douglas Craigie Stevenson adds: "We are committed to simplifying the business model, right-sizing and optimizing the business. We have engaged with S&P throughout this process and believe we are on the right track with the transactions currently being finalized."