Fitch rates Univision notes, add-on B+

Fitch Ratings said it assigned a B+ rating with recovery rating of RR3 to Univision Communications, Inc.’s new $750 million 5 1/8% senior secured notes due 2025.

Fitch also said it assigned a B+ rating with recovery rating of RR3 to the reopened 5 1/8% senior secured notes due 2023, which were increased by $500 million.

The outlook remains stable.

The proceeds of both issuances are to be used to fund the company’s offer to purchase $1.2 billion aggregate amount outstanding of 6 7/8% senior secured notes due 2019 pursuant to the recently launched all-cash tender offer.

The company has an issuer default rating of B, B+ senior secured rating with recovery rating of RR3 and CCC+ senior unsecured rating with recovery rating of RR6.

Fitch said it views the transactions favorably as it will extend Univision’s maturities and provide a modest reduction in interest expense of about $17 million.

The ratings also consider the positive view of the U.S. Hispanic broadcasting industry, given anticipated continued growth in number and spending power of the Hispanic demographic, the agency said.

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