S&P rates Radio One loans BB-, notes CCC+

Standard & Poor's said it placed Radio One Inc.'s CCC+ corporate credit rating on CreditWatch with positive implications.

The company has proposed several transactions to refinance its capital structure and acquire a controlling stake in TV One LLC, S&P said.

Upon completion of the refinancing, and assuming there are no material changes to the proposed terms, the agency said it expects to raise the corporate credit rating to B with a stable outlook.

The agency also said it assigned to its proposed senior secured credit facility a rating of BB-, which is two notches higher than the expected B corporate credit rating, with a recovery rating of 1, indicating an expectation 90% to 100% recovery in the event of a default. The senior secured credit facility consists of a $50 million revolving credit facility due 2014 and a $350 million term loan B, which matures in seven years, or three months prior to the maturity of the company's proposed second-lien notes, unless 85% of the second-lien notes have been repaid by that time, the agency said.

The agency also said it assigned to the company's proposed $100 million secured second-lien notes due 2016 and $267.4 million of unsecured exchange notes due 2017 a rating of CCC+, which is two notches lower than the expected B corporate credit rating, with a recovery rating of 6, indicating an expectation of 0% to 10% recovery in the event of a default.

The company's proposed refinancing plan alleviates risk surrounding near-term maturities and potential covenant violations under its existing credit facility, S&P said.

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