Moody's: PanAmSat outlook developing

Moody's Investors Service said it changed the outlook for PanAmSat Holding Corp. and its operating subsidiary, PanAmSat Corp., to developing from stable in connection with the joint Aug. 29 announcement that Intelsat Ltd. has agreed to acquire the common stock of PAS Holdings for a cash purchase price of about $3.2 billion.

Moody's said the developing outlook reflects that the proposed Intelsat-PanAmSat organization is likely to have significantly higher leverage than the current PanAmSat consolidated group and that incremental debt could be raised at PAS Holdings or PAS to partially fund the equity purchase price.

Moody's also affirmed the existing debt ratings of PanAmSat Holding and PanAmSat Corp.

Affirmed were PanAmSat Corp.'s Ba3 rating for its $2.25 billion guaranteed senior secured credit facility, consisting of $250 million revolver maturing August 2009, a $355.9 million remaining term loan A balance due August 2009 and a $1.6475 billion remaining term loan B balance due August 2011.

Also affirmed were the company's Ba3 rating for $150 million 6.375% senior secured notes due January 2008, its Ba3 rating for $125 million 6.875% senior secured debentures due January 2028, its B1 rating for $656.5 million 9% senior notes due August 2014 and its Ba3 corporate family rating.

PanAmSat Holding Corp.'s B3 rating for $416 million principal at maturity 10.375% senior discount global notes due November 2014 was affirmed.

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