S&P rates Freedom loan BB

Standard & Poor's said it assigned its BB bank loan rating with a recovery rating of 2 to Freedom Communications Inc.'s planned $300 million tranche A-1 term loan facility due 2012 and affirmed its BB corporate credit rating and BB senior secured debt rating with a recovery rating of 3.

The outlook is stable.

Freedom is amending its senior secured credit facilities, the agency said. Under the amendment, the total facilities will be reduced to $950 million from the current $1 billion. The planned $300 million tranche A-1 term loan facility will be used to partially repay the tranche B term loan facility, which has about $348 million outstanding.

The ratings reflect the company's significant debt levels attributable to its recapitalization in 2004, the agency said. And, like other media companies, Freedom is being affected by the uneven advertising revenue climate, higher newsprint prices and the absence of meaningful political television advertising that contributed to 2004's results.

S&P said these factors are tempered by the geographic diversity of Freedom's operations, the relative stability of the community newspaper units and meaningful cash flow generation after capital expenditures and dividends.

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