S&P lowers Viacom to negative

S&P said it revised the outlook on Viacom Inc. to negative from stable and affirmed the ratings on the company, including the BBB- corporate credit rating.

The outlook revision reflects the increased likelihood that Viacom may be unable to reduce and maintain adjusted leverage at less than the 3.25x threshold for the BBB- corporate credit rating by the fiscal year ending Sept. 30, 2017, S&P explained.

The agency said it believes the ongoing legal dispute between National Amusements Inc., Viacom's controlling shareholder, and Viacom's independent directors and executive management team could adversely affect Viacom's operating and financial performance.

The outlook reflects the increased likelihood that Viacom may be unable to lower and maintain its adjusted leverage to less than 3.25x on a sustained basis, S&P said.

Viacom's operating performance across both its cable network and filmed entertainment divisions continues to significantly lag its peers, the agency said.

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