Moody's rates Regal notes B3

Moody's Investors Service said it assigned a B3 rating to Regal Entertainment Group's proposed new $275 million senior unsecured note issuance.

Proceeds from the new issue will be used to retire Regal's $200 million of 6.25% convertible notes due 2011 and repay the $52 million residual from a former $200 million of 9.3875% senior subordinated notes offering by Regal Cinemas, with the remainder used to pay fees and expenses and for general corporate purposes, the agency added.

Consequently, when viewed on a consolidated basis, the issue merely substitutes debt for debt and is deemed neutral to Regal's overall credit profile as represented by the B1 corporate family rating, B1 probability of default rating, stable outlook and SGL-1 speculative-grade liquidity rating, the agency noted.

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