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Moody's, S&P Both Slap Lucent With Downgrade

February 13, 2001|Times Wire Services

More bad news for telecom giant Lucent Technologies: Its credit rating was cut Monday to a notch above junk status by Moody's Investors Service and Standard & Poor's after the firm posted a $1.02-billion first-quarter operating loss.

Moody's cut its rating on Lucent's unsecured long-term debt to "Baa3" from "Baa1." S&P lowered its rating on Lucent's corporate credit to "BBB-" from "BBB+."

Moody's said its downgrade reflected Lucent's "significant operational difficulties." S&P said its downgrade reflected the belief that Lucent will incur "substantial operating losses" in the near to intermediate term.

Lucent "had lost its way in pursuit of growth," said Bruce Hyman, an S&P director.

Lucent's stock fell 56 cents to $14.80 on the NYSE. After rebounding in January, the shares are sliding toward their multiyear low of $13.13 reached in late December.

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