Nov. 11, 2004 During Wednesday's meeting of the Public Services Commission, Joel Holt, attorney for Innovative Communications Corp., said its long-time lender, the Rural Telephone Finance Cooperative, was suing ICC because "RTFC wants to liquidate Vitelco to solve [its] own financial problems." He added that ICC was "probably one of the most solvent companies in the Virgin Islands." (See "Various ICC Lawsuits Remain Unsettled").
RTFC attorney Eric Cowan responded at the meeting that the cooperative's financial standing could be easily determined by examining its Securities and Exchange Commission filings.
Since ICC is privately held, it has no obligation to file financial reports with the SEC, but it has come to the Source's attention that Standard & Poor's, the nation's leading credit-rating agency, released a bulletin in August that said, in part: "Standard & Poor's has always considered Innovative Communications to be a high-risk credit among CFC's top-10 borrowers."
S&P issued its August bulletin in the wake of RTFC's suit against ICC in federal court for allegedly breaching loan and security agreements, writing "[the suit] is unfavorable for credit quality but does not affect the rating or outlook on CFC." At the time S&P confirmed its earlier rating of CFC, A/Stable/A-1.
Industry sources say that S&P has been quietly following the ICC/CFC relationship for years, and while S&P has warned before, in general terms, about the cooperative's exposure to its 10 largest borrowers, particularly those among the top 10 in telecommunications, it has never mentioned ICC by name until the Aug. 4 bulletin. ICC, a telecommunications firm, has been one of the top 10 for years.
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