Fitch cuts Tribune

Fitch Ratings said it has downgraded Tribune's Co.'s issuer default rating to A- from A. Fitch also lowered Tribune's $1.2 billion senior unsecured revolving credit facility due 2008 to A- from A, senior unsecured notes due 2006-2027 to A- from A, subordinated exchangeable debentures due 2029 to BBB+ from A- and commercial paper program to F2 from F1.

The outlook is negative.

The downgrade affects about $2 billion of senior unsecured debt and about $1.3 billion face value of senior subordinated exchangeable securities.

The ratings were placed on negative watch in September after Tribune said it was estimating a tax liability of $1 billion with a net cash outflow of $850 million over the next six months in association with its purchase of Times Mirror in 2000. The company intends to finance the cash payment with commercial paper borrowings, Fitch said.

The downgrade reflects Fitch's expectation that debt levels will remain higher than historical levels through 2006 as a result of the debt-funded tax payment.

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