(Bloomberg) -- Apollo Global Management-backed internet provider Brightspeed will need to restructure its debt load in the near future, Fitch Ratings said Friday.

Fitch slashed Brightspeed’s credit grade one notch to CCC, citing under-performance on earnings and declining liquidity, among other things. Fitch said it expects the company to burn substantial cash as it builds out its fiber network.

“Fitch believes the company’s capital structure is unsustainable and a near-future debt restructuring exercise is inevitable,” analysts led by Salonie Sehgal said in a note. 

A spokesperson for Brightspeed said Fitch’s action doesn’t change the company’s operations or strategy.

“Brightspeed has an ambitious plan which involves deploying large amounts of capital to support our strategic fiber network build across our footprint,” the spokesperson said in an emailed statement. The company said it is working closely with its capital partners to support the plan. 

Apollo declined to comment.

Apollo agreed to buy Brightspeed — a carveout from Lumen Technologies Inc. — in late 2021, just before interest rates began rising. It has since struggled amid rising costs and an onerous debt burden.

PJT Partners is advising Apollo on options for Brightspeed’s debt load, Bloomberg previously reported.

(Adds company statement and Apollo’s response to comment request.)

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