On 11 November 2025, Moody\u2019s delivered a further downgrade, saying it reflects its increasing concerns over Liquid Telecom\u2019s ability to refinance its upcoming debt maturities in February and September 2026.<\/p>\n\n\n\n
The agency said its rating took into account Liquid\u2019s strong market position as the largest pan-African fibre network covering more than 20 countries across central, Eastern and Southern Africa.<\/p>\n\n\n\n
It also factored in Liquid\u2019s exposure to supportive industry dynamics, given the growing demand for carrier and enterprise broadband services across Africa.<\/p>\n\n\n\n
Additionally, Moody\u2019s said its rating considers Liquid\u2019s long-standing contractual relationships with a blue-chip customer base with moderate customer concentration and low customer churn.<\/p>\n\n\n\n
Despite this, Liquid\u2019s outstanding debts continue to be a concern. As of August 2025, Liquid had $131 million (R2.27 billion) outstanding under a rand-denominated term loan due in February 2026.<\/p>\n\n\n\n
Alongside this is a $620 million (R10.7 billion) bond maturing in September 2026. The covenants relevant to these loans are net leverage ratio, interest cover, and debt service cover ratio.<\/p>\n\n\n\n
In its half-year results released on 23 October for the period ended 31 August 2025, Liquid disclosed that its net debt to adjusted EBITDA ratio was 3.45\u00d7, compared to the covenant of 3.50\u00d7.<\/p>\n\n\n\n
It defines adjusted EBITDA as earnings before interest, taxation, depreciation, impairment, and amortisation, which is presented before recognising several items.<\/p>\n\n\n\n
Those items excluded from adjusted EBITDA are dividends, restructuring costs, net foreign exchange losses and gains, and hyperinflation monetary gain.<\/p>\n\n\n\n
\u201cOver the past two years, the company has actively pursued a strategy to reduce leverage through asset sales and equity injections,\u201d stated Moody\u2019s.<\/p>\n\n\n\n
\u201cLiquid Telecom aims to reduce debt and support the refinancing of a smaller, more sustainable debt structure.\u201d Moody\u2019s said it viewed the company\u2019s existing debt as unsustainably high.<\/p>\n\n\n\n
Moody\u2019s explained that, because of the current high interest rate environment, Liquid will get much higher rates on any new debt compared to what it currently pays on its bond.<\/p>\n\n\n\n
\u201cThe $620 million senior secured notes have a coupon of 5.5%. Materially higher rates will put pressure on the company’s ability to generate free cash flow,\u201d Moody\u2019s said.<\/p>\n\n\n\n
This will lead to a weakening of Liquid\u2019s interest coverage ratio to below 1x when excluding EBITDA and capex from Zimbabwe. The ratio is defined as EBITDA less capex, divided by interest expense.<\/p>\n\n\n\n
Liquid\u2019s risky rescue plan<\/h2>\n\n\n\n![\"\"](\"https:\/\/mybroadband.co.za\/news\/wp-content\/uploads\/2025\/11\/Liquid-Intelligent-Technologies-events-booth.jpg\")
<\/figure>\n\n\n\n\u201cLiquid Telecom is aiming to raise a total of $185 million of equity, to be used to repay debt and bolster its cash balance,\u201d the ratings agency said.<\/p>\n\n\n\n
\u201cWhile the company has made some progress towards this plan, there have been repeated delays to milestones and so far, the company has succeeded in raising only $60 million.\u201d<\/p>\n\n\n\n
It plans to raise a further $100 million from asset sales in the wider Cassava group, outside of the Liquid Telecom bond perimeter and to inject it into the company.<\/p>\n\n\n\n
\u201cCassava group has secured commitments from an investor in this regard, but completion of the transaction remains subject to completion of certain conditions precedent,\u201d Moody\u2019s stated.<\/p>\n\n\n\n
\u201cWe understand the company also has plans to raise another $25 million of equity in short order.\u201d<\/p>\n\n\n\n
Regarding refinancing its debt, Liquid has secured a $220 million equivalent commitment from a lender to refinance its February 2026 loan maturity.<\/p>\n\n\n\n
However, this commitment remains contingent on Liquid Telecom successfully completing a planned $125 million equity raise.<\/p>\n\n\n\n
\u201cThe limited time remaining before maturity of the loan to finalise the two separate equity transactions introduces uncertainty and heightens the risk of a payment default should further delays occur,\u201d Moody\u2019s warned.<\/p>\n\n\n\n
Liquid has also announced its refinancing strategy for the $620 million bond maturing in September 2026.<\/p>\n\n\n\n
That plan includes repaying $170 million through equity proceeds and refinancing the remaining $450 million via a combination of commercial loans and a bond.<\/p>\n\n\n\n
Moody\u2019s said that although discussions with lenders and investors are underway, the execution of this plan remains dependent on refinancing its rand-denominated term loan.<\/p>\n\n\n\n
Material going concern risk<\/h2>\n\n\n\n![\"\"](\"https:\/\/mybroadband.co.za\/news\/wp-content\/uploads\/2025\/11\/Liquid-Telecoms-offices-Midrand.jpg\")
<\/figure>\n\n\n\nPrior to the Moody\u2019s downgrade, Liquid noted in its half-year results that there were material risks to the future of the company.<\/p>\n\n\n\n
\u201cDespite the progress made on the refinancing project, it is not yet complete. Whilst the directors expect this to happen in the going concern period, there nonetheless remains a material uncertainty,\u201d it stated.<\/p>\n\n\n\n
That uncertainty includes the quantum and timing of the completion of the refinancing project associated with its $620 million bond due in September 2026.<\/p>\n\n\n\n
\u201cWithout the conclusion of the refinancing project, the group will not have the ability to repay, given its current cash and liquidity constraints,\u201d Liquid said.<\/p>\n\n\n\n
Should Liquid fail to raise the necessary funds, it would trigger the \u201cdownside scenario\u201d, which would require mitigating action to be taken.<\/p>\n\n\n\n
\u201cThese mitigating actions may include for example, the reduction of operating and capital expenditure and a continuing focus on working capital management, particularly in the collection cycle for receivables balances,\u201d it said.<\/p>\n\n\n\n
\u201cThese mitigating actions are not fully contemplated in the directors\u2019 forecasts nor are they fully in the control of the directors.\u201d<\/p>\n\n\n\n
Therefore, if this downside scenario were to occur, and trading were to also deteriorate after mitigating actions, Liquid would need to approach its creditors.<\/p>\n\n\n\n
\u201cThe directors would need to obtain consent for a waiver from certain lenders, which is outside of their control as at the date of signing these financial statements,\u201d the company said.<\/p>\n\n\n\n
MyBroadband contacted Liquid for comment, and it declined to answer questions about whether it was in financial crisis or add additional context to its going concern warning.<\/p>\n\n\n\n
\u201cWe are aware of Moody\u2019s revised rating on the company\u2019s bond due September 2026. We cannot comment on the merits of their decision,\u201d a Liquid spokesperson told MyBroadband.<\/p>\n\n\n\n
\u201cOur debt refinancing plans are progressing well with the significant milestones that we have recently announced to the market. We will communicate to the market as we complete the rest of our refinancing plan.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
Liquid Intelligent Technologies is in deep financial trouble, which has led to Moody\u2019s Investors Service downgrading its corporate family rating and probability of default rating.<\/p>\n","protected":false},"author":15,"featured_media":616636,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"idle","_sma_x_autopost_error":"","_sma_x_post_id":"","_sma_facebook_post_id":"","_sma_instagram_post_id":"","_sma_threads_post_id":"","_sma_x_attempts":0,"footnotes":""},"categories":[41906],"tags":[77524,96337,68978],"class_list":["post-619575","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-telecoms","tag-cassava-technologies","tag-hardy-pemhiwa","tag-liquid-intelligent-technologies-lit"],"_links":{"self":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/619575"}],"collection":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/comments?post=619575"}],"version-history":[{"count":2,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/619575\/revisions"}],"predecessor-version":[{"id":619607,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/619575\/revisions\/619607"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media\/616636"}],"wp:attachment":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media?parent=619575"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/categories?post=619575"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/tags?post=619575"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
<\/figure>\n\n\n\n\u201cLiquid Telecom is aiming to raise a total of $185 million of equity, to be used to repay debt and bolster its cash balance,\u201d the ratings agency said.<\/p>\n\n\n\n
\u201cWhile the company has made some progress towards this plan, there have been repeated delays to milestones and so far, the company has succeeded in raising only $60 million.\u201d<\/p>\n\n\n\n
It plans to raise a further $100 million from asset sales in the wider Cassava group, outside of the Liquid Telecom bond perimeter and to inject it into the company.<\/p>\n\n\n\n
\u201cCassava group has secured commitments from an investor in this regard, but completion of the transaction remains subject to completion of certain conditions precedent,\u201d Moody\u2019s stated.<\/p>\n\n\n\n
\u201cWe understand the company also has plans to raise another $25 million of equity in short order.\u201d<\/p>\n\n\n\n
Regarding refinancing its debt, Liquid has secured a $220 million equivalent commitment from a lender to refinance its February 2026 loan maturity.<\/p>\n\n\n\n
However, this commitment remains contingent on Liquid Telecom successfully completing a planned $125 million equity raise.<\/p>\n\n\n\n
\u201cThe limited time remaining before maturity of the loan to finalise the two separate equity transactions introduces uncertainty and heightens the risk of a payment default should further delays occur,\u201d Moody\u2019s warned.<\/p>\n\n\n\n
Liquid has also announced its refinancing strategy for the $620 million bond maturing in September 2026.<\/p>\n\n\n\n
That plan includes repaying $170 million through equity proceeds and refinancing the remaining $450 million via a combination of commercial loans and a bond.<\/p>\n\n\n\n
Moody\u2019s said that although discussions with lenders and investors are underway, the execution of this plan remains dependent on refinancing its rand-denominated term loan.<\/p>\n\n\n\n
Material going concern risk<\/h2>\n\n\n\n<\/figure>\n\n\n\nPrior to the Moody\u2019s downgrade, Liquid noted in its half-year results that there were material risks to the future of the company.<\/p>\n\n\n\n
\u201cDespite the progress made on the refinancing project, it is not yet complete. Whilst the directors expect this to happen in the going concern period, there nonetheless remains a material uncertainty,\u201d it stated.<\/p>\n\n\n\n
That uncertainty includes the quantum and timing of the completion of the refinancing project associated with its $620 million bond due in September 2026.<\/p>\n\n\n\n
\u201cWithout the conclusion of the refinancing project, the group will not have the ability to repay, given its current cash and liquidity constraints,\u201d Liquid said.<\/p>\n\n\n\n
Should Liquid fail to raise the necessary funds, it would trigger the \u201cdownside scenario\u201d, which would require mitigating action to be taken.<\/p>\n\n\n\n
\u201cThese mitigating actions may include for example, the reduction of operating and capital expenditure and a continuing focus on working capital management, particularly in the collection cycle for receivables balances,\u201d it said.<\/p>\n\n\n\n
\u201cThese mitigating actions are not fully contemplated in the directors\u2019 forecasts nor are they fully in the control of the directors.\u201d<\/p>\n\n\n\n
Therefore, if this downside scenario were to occur, and trading were to also deteriorate after mitigating actions, Liquid would need to approach its creditors.<\/p>\n\n\n\n
\u201cThe directors would need to obtain consent for a waiver from certain lenders, which is outside of their control as at the date of signing these financial statements,\u201d the company said.<\/p>\n\n\n\n
MyBroadband contacted Liquid for comment, and it declined to answer questions about whether it was in financial crisis or add additional context to its going concern warning.<\/p>\n\n\n\n
\u201cWe are aware of Moody\u2019s revised rating on the company\u2019s bond due September 2026. We cannot comment on the merits of their decision,\u201d a Liquid spokesperson told MyBroadband.<\/p>\n\n\n\n
\u201cOur debt refinancing plans are progressing well with the significant milestones that we have recently announced to the market. We will communicate to the market as we complete the rest of our refinancing plan.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
Liquid Intelligent Technologies is in deep financial trouble, which has led to Moody\u2019s Investors Service downgrading its corporate family rating and probability of default rating.<\/p>\n","protected":false},"author":15,"featured_media":616636,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"idle","_sma_x_autopost_error":"","_sma_x_post_id":"","_sma_facebook_post_id":"","_sma_instagram_post_id":"","_sma_threads_post_id":"","_sma_x_attempts":0,"footnotes":""},"categories":[41906],"tags":[77524,96337,68978],"class_list":["post-619575","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-telecoms","tag-cassava-technologies","tag-hardy-pemhiwa","tag-liquid-intelligent-technologies-lit"],"_links":{"self":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/619575"}],"collection":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/comments?post=619575"}],"version-history":[{"count":2,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/619575\/revisions"}],"predecessor-version":[{"id":619607,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/619575\/revisions\/619607"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media\/616636"}],"wp:attachment":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media?parent=619575"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/categories?post=619575"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/tags?post=619575"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
<\/figure>\n\n\n\nPrior to the Moody\u2019s downgrade, Liquid noted in its half-year results that there were material risks to the future of the company.<\/p>\n\n\n\n
\u201cDespite the progress made on the refinancing project, it is not yet complete. Whilst the directors expect this to happen in the going concern period, there nonetheless remains a material uncertainty,\u201d it stated.<\/p>\n\n\n\n
That uncertainty includes the quantum and timing of the completion of the refinancing project associated with its $620 million bond due in September 2026.<\/p>\n\n\n\n
\u201cWithout the conclusion of the refinancing project, the group will not have the ability to repay, given its current cash and liquidity constraints,\u201d Liquid said.<\/p>\n\n\n\n
Should Liquid fail to raise the necessary funds, it would trigger the \u201cdownside scenario\u201d, which would require mitigating action to be taken.<\/p>\n\n\n\n
\u201cThese mitigating actions may include for example, the reduction of operating and capital expenditure and a continuing focus on working capital management, particularly in the collection cycle for receivables balances,\u201d it said.<\/p>\n\n\n\n
\u201cThese mitigating actions are not fully contemplated in the directors\u2019 forecasts nor are they fully in the control of the directors.\u201d<\/p>\n\n\n\n
Therefore, if this downside scenario were to occur, and trading were to also deteriorate after mitigating actions, Liquid would need to approach its creditors.<\/p>\n\n\n\n
\u201cThe directors would need to obtain consent for a waiver from certain lenders, which is outside of their control as at the date of signing these financial statements,\u201d the company said.<\/p>\n\n\n\n
MyBroadband contacted Liquid for comment, and it declined to answer questions about whether it was in financial crisis or add additional context to its going concern warning.<\/p>\n\n\n\n
\u201cWe are aware of Moody\u2019s revised rating on the company\u2019s bond due September 2026. We cannot comment on the merits of their decision,\u201d a Liquid spokesperson told MyBroadband.<\/p>\n\n\n\n
\u201cOur debt refinancing plans are progressing well with the significant milestones that we have recently announced to the market. We will communicate to the market as we complete the rest of our refinancing plan.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
Liquid Intelligent Technologies is in deep financial trouble, which has led to Moody\u2019s Investors Service downgrading its corporate family rating and probability of default rating.<\/p>\n","protected":false},"author":15,"featured_media":616636,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"idle","_sma_x_autopost_error":"","_sma_x_post_id":"","_sma_facebook_post_id":"","_sma_instagram_post_id":"","_sma_threads_post_id":"","_sma_x_attempts":0,"footnotes":""},"categories":[41906],"tags":[77524,96337,68978],"class_list":["post-619575","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-telecoms","tag-cassava-technologies","tag-hardy-pemhiwa","tag-liquid-intelligent-technologies-lit"],"_links":{"self":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/619575"}],"collection":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/comments?post=619575"}],"version-history":[{"count":2,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/619575\/revisions"}],"predecessor-version":[{"id":619607,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/619575\/revisions\/619607"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media\/616636"}],"wp:attachment":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media?parent=619575"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/categories?post=619575"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/tags?post=619575"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}