Moody's cuts Nexstar loan, rates loan Ba3

Moody's Investors Service said it assigned a Ba3 rating to the proposed first-lien credit facility of Nexstar Broadcasting, Inc.

The company plans to use proceeds primarily to fund the acquisition of Communications Corp. of America and White Knight Broadcasting.

Moody's also cut Nexstar's senior secured first-lien credit facility to Ba3 (LGD 2-24%) from Ba2 (LGD2-19%) and assigned a Ba3 rating to Rocky Creek Communications, Inc.'s senior secured first-lien term loan.

At the same time, the agency affirmed Nexstar's B2 corporate family rating, B2-PD probability of default rating, SGL-2 speculative grade liquidity rating, the B3 rating on its 8 7/8% second-lien bonds and the Caa1 rating on its 6 7/8% senior unsecured bonds.

Moody's said it estimates that the debt-funded transaction will increase Nexstar's leverage to about 5.5 times debt-to-EBITDA on a two year average basis from approximately 5 times as of the 12 months ended March 31 (two year average, pro forma for recent acquisitions and related financing).

Incorporating expected synergies would reduce two-year average leverage to about 5.2 times debt-to-EBITDA, and the agency said it expects the company to achieve these synergies within the first year of the acquisition.

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