S&P keeps E.W. Scripps on CreditWatch negative

S&P said it will keep all of its ratings for E.W. Scripps Co. on CreditWatch negative pending closing of the company’s acquisition of Nexstar Media Group Inc. TV stations.

“We expect to lower the issuer credit rating to B from B+ if the transaction closes and is funded with incremental debt. We would affirm the B+ issuer credit rating if the transaction is cancelled or if funding is materially different than our expectations, resulting in forecast leverage improving below 5.25x by the end of 2020,” S&P said in a news release.

The $580 million acquisition is expected to be funded with incremental debt, resulting in adjusted pro forma average trailing-eight-quarters leverage of 6.8x-7x in 2019 and remaining above our 5.25x threshold for the B+ rating through 2020, S&P said.

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