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America Movil Downgrade Still Under Review by Moody’s After KPN

America Movil SAB still faces a credit rating downgrade by Moody’s Investors Service, even after withdrawing a $9.8 billion takeover bid for Royal KPN NV that drew the ratings company’s scrutiny.

Billionaire Carlos Slim’s company said this week that it refused to give in to pressure from the Dutch phone carrier to raise its offer higher than 2.40 euros ($3.28) a share. While the withdrawn bid does increase the chance America Movil can keep its A2 rating, Moody’s said today it needs to review the way other acquisitions could affect the company’s debt.

America Movil, Latin America’s largest wireless company, hasn’t decided whether to maintain its financial stake of about 30 percent in KPN, and Dutch law prevents the company from making a new takeover bid for six months. Slim may choose to pursue takeovers in Europe or Brazil in the meantime, analysts at Corporativo GBM SAB and Sanford C. Bernstein & Co. have said.

“While the withdrawal of the offer is viewed as generally credit-positive for America Movil’s ratings, as it eliminates the potential heightened operational and financial challenges of controlling KPN, our review will still focus on the potential for other acquisitions and the likely impact on its leverage and other credit metrics,” Soummo Mukherjee, a Moody’s senior analyst, said today in a statement.

America Movil’s rating could remain the same, five levels above non-investment grade, if the Mexico City-based company is likely to maintain total debt of no more than 1.5 times earnings, Moody’s said.

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