Qatari Qtel Faces Possible Moody's Downgrade

Ratings agency Moody's has placed Qatar Telecommunications Co (Qtel) on review for a possible downgrade citing weak financial performance at its Indonesian unit. A potential downgrade may impact US$1.5 billion of the telecom operator's debt, Moody's said on Wednesday. Qtel's Indonesian unit, PT Indosat, posted an 88% drop in its fourth-quarter net profit, as competition heated up and as the number of its subscribers fell by 9.3% last year. Moody's downgraded its outlook on Indosat, Indonesia's second-largest mobile phone operator, to negative from stable on Wednesday.

"Following the change in outlook for Indosat in light of a weaker financial profile and Moody's expectation of increasingly limited headroom under Indosat's financial covenants, Moody's is reviewing the impact this may have on Qtel," said Martin Kohlhase, a Dubai-based Moody's assistant vice president. -Reuters