Moody's cuts Freedom Communications

Moody's Investors Service said it downgraded Freedom Communications, Inc.'s corporate family rating to B3 from B2, its probability-of-default rating to Caa1 from B3 and its $300 million senior secured revolving credit facility due 2011, $306 million senior secured term loan A due 2011 and $300 million senior secured term loan A-1 due 2012 to B3 (LGD3, 31%) from B2 (LGD3, 32%).

The ratings were placed under review for further possible downgrade.

The downgrade reflects Moody's view that a recent worsening in operating performance has heightened the probability that the company will default on its senior secured loan agreement, absent lender relief. The agency believes a near-term default is highly probable unless Freedom is able to relax its senior secured financial ratio tests and reschedule its amortization profile.

The review for possible downgrade will consider the probability that Freedom will succeed in addressing prospective technical and payment defaults absent lender relief as well as the company's ability to improve a currently very tight liquidity profile and to stabilize the level of its sales and free cash flow.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.