Hughes Electronics Debt Rating Lowered

S&P cites concerns over discretionary cash flow deficits and refinancing risk

On Nov. 18, Standard & Poor's lowered its corporate credit ratings on Hughes Electronics (GMH ) and its 81%-owned subsidiary PanAmSat (SPOT ) to 'B+' from 'BB-'. Standard & Poor's also lowered its senior secured bank loan ratings on the companies to 'BB-' from 'BB'. The downgrade reflects concern about continuing discretionary cash flow deficits and refinancing risk at Hughes. The PanAmSat downgrade reflects the company's majority ownership by Hughes and not PanAmSat's stand-alone operating performance or financial condition, which have been stable.

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