KPN results raise threat of credit downgrading

Debt laden telco struggling to keep its head above water...

Dutch telco KPN has announced losses of E1.038bn (£645m) for the first half of 2001. The ailing telco outperformed analysts' predictions but the markets still reacted unfavourably - with KPN's share price falling 20 per cent to an all time low, before recovering slightly to E2.95 (£1.83). KPN is currently struggling with massive debts of E22.8bn (£14.1bn) and is facing the likelihood of its credit rating being downgraded. A proposed merger with Belgacom which would have eased KPN's debt problems fell through last week.