SINGAPORE: Nov. 14, 2008. (PCP) Standard & Poor's Ratings Services said today it lowered its long-term corporate credit rating on Pakistan Mobile Communications Ltd. (Mobilink) to 'B-' from 'B'. The outlook on the rating remains negative. At the same time, Standard & Poor's lowered its issue rating on Mobilink's senior unsecured notes to 'B-' from 'B'. The rating actions follow Standard & Poor's decision to lower the long-term and short-term sovereign credit ratings on Pakistan (Islamic Republic of) (foreign currency CCC/Developing/C; local currency CCC+/Developing/C) with a developing outlook. In tandem with lowering of the sovereign rating, Pakistan's transfer and convertibility (T&C) rating has been moved to 'B-' from 'B'. "The rating downgrade reflects Mobilink's heightened exposure to funding risks, further deterioration of the country's economic situation and more difficult operating conditions," said Standard & Poor's credit analyst Yasmin Wirjawan. The rating on Mobilink also reflects the expected decline in cash-flow-protection measures, increased competition, and high management fees to its shareholder, Orascom Telecom Holdings S.A.E. (B+/Negative/--). These risks are partly offset by strategic benefits, likely funding support from its parent, the company's leading market position, and its first-mover advantage. The negative rating outlook on Mobilink reflects the risk factors on Pakistan, its business environment and the possibility of a further deterioration due to the government's current fiscal situation. In the near to medium term, Standard & Poor's expects the rating on Mobilink to be driven by the country's risk environment and the company's ability to maintain adequate internal cash generation and liquidity.