Moody's drops Radio One

Moody's Investors Service said it has downgraded Radio One, Inc.'s corporate family rating to Caa1 from B3 and its probability of default rating to Caa2 from Caa1 prompted by heightening concern regarding liquidity and default risk.

Affected ratings include the company's $500 million secured revolver to B2, LGD2, 18% from Ba3, LGD2, 13%; $300 million secured term loan to B2, LGD2, 18% from Ba3, LGD2, 13%; $200 million 6 3/8% senior subordinated notes to Caa3, LGD4, 69% from Caa2, LGD4, 63%; and $300 million 8 7/8% senior subordinated notes to Caa3, LGD4, 69% from Caa2, LGD4, 63%.

The outlook remains negative.

The agency added that the downgrade of the corporate family rating to Caa1 reflects Moody's heightening concern that recessionary market conditions will continue in most of Radio One's served broadcast markets over the near-to-intermediate term, compressing the company's cash flow and squeezing its liquidity.

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