Moody's rates Tribune loan Ba2

Moody's Investors Service said it assigned a Ba2 (LD3, 37%) rating to Tribune Co.'s proposed $1.5 billion senior secured tranche X term loan due 2009.

The company's ratings, including the Ba3 corporate family rating, remain on review for downgrade.

The amount of the bridge loan was reallocated from the proposed $7.015 billion term loan B, which is now reduced to $5.515 billion. Tribune plans to use the proceeds to refinance its existing $2.8 billion of credit facilities and to fund the $4.2 billion first-step tender offer for Tribune common stock as part of the company's privatization plan.

Moody's noted that the bridge loan has required amortization of $750 million in 18 months and is entitled to all mandatory prepayments, including from asset sales, until the bridge loan is repaid. The agency believes this, and the two-year maturity, raises refinancing risk.

The agency said it will likely downgrade the company's corporate family rating to B2 if the second step of the privatization plan is completed as currently planned and if industry conditions, the company's cash flow generation and anticipated asset sale proceeds are in line with Moody's expectations.

© 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.