S&P cuts Cincinnati Bell debt, rates facility BB-

S&P said it lowered the issue-level rating on Cincinnati Bell Inc.'s senior unsecured debt to B- from B and revised the recovery rating to 5 from 4.

The affected debt includes Cincinnati Bell's $625 million of 7% senior unsecured notes due 2024. The 5 recovery rating indicates an expectation of modest (10% to 30%; rounded estimate: 25%) recovery in the event of payment default.

At the same time, the agency placed the senior unsecured debt rating on CreditWatch with negative implications.

S&P also said it assigned a BB- issue-level rating and 1 recovery rating to the company’s proposed $180 million senior secured revolving credit facility due 2022 and $600 million term loan B due 2024. The 1 recovery rating indicates anu expectation of very high (90% to 100%; rounded estimate: 95%) recovery in the event of payment default.

Net proceeds from the term loan will be used to partially fund the acquisitions of Hawaiian Telcom Holdco Inc. and OnX Enterprise Solutions and also refinance a portion of the roughly $315 million outstanding of the company's existing term loan B. The agency currently expects the company to issue another $350 million of senior unsecured notes to complete the debt portion of its financing package however terms have not yet been finalized.

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