Ericsson Shares Are Hit as Credit Is Rated Junk
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Telecom equipment maker Ericsson had its credit rating cut to “junk” status by Moody’s Investors Service, but the Swedish company said the underwriting of its $3.25-billion new stock issue was not in danger.
Moody’s cut the Swedish company’s long-term debt rating one notch to Ba1 from Baa3, based on the rapid decline in investments by telecommunications carriers and the challenges faced by Ericsson to cut costs quickly.
In Nasdaq trading, Ericsson American depositary receipts fell 16 cents to 84 cents.
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