Moody's rates Alpha Media loans B3, Ba3

Moody's Investors Service said it assigned Alpha Media Group Inc. B1 corporate family and probability-of-default ratings in connection with its proposed acquisition of Dennis Publishing Inc.

Moody's also assigned a Ba3 rating (LGD3, 36%) to the issuer's $15 million senior first-lien secured revolving credit facility and $120 million senior secured first-lien term loan and a B3 rating (LGD5, 83%) to its $40 senior secured second lien term loan.

The outlook is stable.

The outlook incorporates Alpha Media's dependable top line and expectation that new management will succeed in revitalizing profitability and renegotiating vendor contracts.

The corporate family rating reflects the proposed acquisition's resulting debt burden and leverage, the group's reliance on advertising in men's lifestyle magazines, decline in the company's top-line results, slide in newsstand sales of its flagship publication MAXIM magazine in 2006 and the steep competition posed by stronger and higher rated rivals, Moody's said.

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