Alcatel, the French telecoms equipment provider which has been downgraded by Moody's, will avoid the fate of its UK counterpart, Marconi, and hold on to its coveted investment grade status, analysts have predicted.

Moody's downgraded Alcatel's credit rating by two notches, to Baa1 from A2, three notches above a junk rating. However, the agency, whose new ratings for Alcatel are in line with those of its rival rating agency Standard & Poor's, left the outlook for the company's ratings on negative.