S&P rates Time notes B, ups existing senior notes

S&P said it affirmed its B corporate credit rating on Time Inc. The outlook is stable.

At the same time, S&P assigned a BB- issue-level rating and 1 recovery rating to the company's proposed senior secured credit facilities. The 1 recovery rating indicates an expectation for very high (90%-100%; rounded estimate: 95%) recovery of principal in the event of a payment default.

S&P also assigned a B issue-level rating and 4 recovery rating to the proposed $300 million senior secured notes due 2025. The 4 recovery rating indicates an expectation for average (30%-50%; rounded estimate: 35%) recovery in the event of a payment default.

Finally, S&P raised its issue-level rating on the company's 5¾% senior notes to B from B- and revised the recovery rating on the notes to 4 from 5. The 4 recovery rating indicates an expectation for average (30%-50%; rounded estimate: 35%) recovery in the event of a payment default.

S&P said the rating actions follow Time Inc.'s announcement of its leverage-neutral refinancing transaction, which extends Time Inc.'s weighted average maturity profile by about two years. The improvement in the recovery ratings on the 5¾% senior unsecured notes due 2022 reflects the proposed debt refinancing, which reduces the absolute amount of priority ranking debt and commitments, and improves recovery prospects for junior lenders in a payment waterfall, the agency added.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.