U S West Inc. said last week it plans to sell its financial services unit, U S West Financial Services, to raise cash for telecommunications ventures.
U S West also owns Financial Security Assurance through a subsidiary, U S West Capital Corp. Although last week's announcement does not affect FSA, U S West has previously said it plans to reduce its holdings in non-telecommunications companies like FSA.
"U S West has indicated on several previous occasions that its dedication to building a preeminent telecommunications business will require significant capital investment over the course of this decade," FSA said in a statement issued last week. "One of the ways they will finance this growth is by reducing the level of investment in non-telecommunications businesses."
A spokeswoman for FSA stressed, however, that U S West has indicated the reduction in non-telecommunications investments would be managed in a way that does not threaten FSA's triple-A ratings.
A statement from U S West says, "With the emerging growth opportunities in telecommunications, particularly in the area of broadband and wireless personal communications services, it's time to redeploy our resources to that area of the business at home and abroad."
U S West Capital Corp., a subsidiary of U S West Inc., owns 91.6% of FSA. Tokio Marine and Fire Insurance Co. owns the remaining 8.4%.