Moody's lowers Reader's Digest

Moody's Investors Service said it downgraded Reader's Digest Association's corporate family and probability-of-default rating to B3 from B2, senior secured credit facility ratings to B2 (LGD3, 36%) from B1 (LGD3, 34%) and senior subordinated note rating to Caa2 (LGD5, 88%) from Caa1 (LGD5, 85%).

The outlook is negative.

The downgrade reflects expectation that weak consumer spending will create incremental revenue pressure on top of the risk of long-term erosion in the company's mature print-based publishing products, according to the agency.

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