Moody's rates Emmis CFR, loans B2

Moody's Investors Service said it assigned Emmis Operating Co. a B2 corporate family rating and a B3-PD probability of default rating.

The agency also assigned a B2 to the proposed credit facilities, consisting of a $20 million senior secured revolver and a $185 million senior secured term loan.

In addition, Moody's assigned an SGL-2 speculative grade liquidity rating.

The outlook is stable.

Proceeds will be used to fund the acquisition of WBLS/WLIB radio stations in New York for $131 million plus LMA payments, refinance $54 million of outstanding debt and pay transaction related expenses.

Moody's said the corporate family rating reflects Emmis' high debt-to-EBITDA of 5.4x as of Feb. 28 (including Moody's standard adjustments, pro forma for the acquisition of WBLS/WLIB), and dependence on New York and Los Angeles markets for 71% of radio broadcast cash flow.

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