Moody's: Citadel view negative

Moody's Investors Service said it affirmed Citadel Broadcasting Corp.'s Ba3 corporate family and probability-of-default ratings and Ba3 senior secured ratings (LGD3, 43%) on its $200 million senior secured revolving credit facility, $600 million tranche A term loan and $1.535 billion tranche B term loan.

The outlook was revised to negative from stable, reflecting the weakness in the operating performance of both the acquired ABC Radio business and the existing Citadel stations, the agency said.

Citadel's Ba3 corporate family rating and negative outlook reflect debt-to-EBITDA leverage in excess of 7.5 times as of Sept. 30; continued challenges in improving the performance of the acquired ABC Radio business, weaker station operating performance in several markets and weaker credit metrics, according to Moody's.

The rating also reflects the inherent cyclicality of the advertising business, cross media-competition faced by radio for audience and advertising revenue and Moody's belief that radio is a mature industry with modest growth prospects, the agency said.

The rating is supported by Citadel's significant geographic, format and revenue diversification, strong station clusters and significant scale, Moody's said.

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