S&P rates DirecTV loan BB

Standard & Poor's said it assigned its BB bank loan rating and 3 recovery rating to the proposed $2.5 billion senior secured credit facility of satellite direct-to-home TV operator DirecTV Holdings LLC.

Ratings on the company and parent The DirecTV Group Inc. (BB/stable/--) were affirmed, including the BB corporate credit and BB- senior unsecured debt ratings. The outlook is stable.

The rating on the existing credit facility will be withdrawn after the new facility closes.

Gross proceeds of the proposed loan totaling $2 billion, plus $531 million in parent company cash equity, will be used to refinance the existing $1 billion credit facility, to redeem $490 million of the existing 8 3/8% senior notes, to repay the $875 million parent company term loan and for premiums, fees and cash.

S&P said ratings on DirecTV continue to reflect aggressive subscriber growth and retention efforts in the intensely competitive pay-TV industry, elevated satellite capital expenditures needed to support growth initiatives and substantial spending on high profile sports programming.

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