S&P rates Videotron notes B+, loan BB+

Standard & Poor's said it assigned its B+ rating to Videotron Ltee's proposed $300 million 6.875% senior unsecured notes due Jan. 15, 2014.

At the same time, S&P affirmed its BB+ bank loan rating and assigned a recovery rating of 1 to Videotron Ltee's proposed C$450 million senior secured five-year revolving credit facility.

In addition, all ratings outstanding on Videotron and its parent company, Quebecor Media Inc., along with the ratings on its subsidiaries Sun Media Corp. and CF Cable TV Inc., including the BB- long-term corporate credit rating, were affirmed. The outlook is stable.

Proceeds from the proposed senior unsecured notes will be primarily used to repay Videotron's term C loan. The proposed C$450 million revolving credit facility, which is expected to be undrawn at closing, will replace Videotron's existing C$100 million revolving credit facility.

S&P said the ratings on Quebecor Media largely reflect its aggressive financial profile, high debt leverage, intense competition, and cyclical industry fundamentals in the company's newspaper division. These factors are partially offset by Quebecor Media's solid market positions in newspapers and cable, which together account for about 72% of consolidated revenues and 83% of consolidated operating income for the nine months ended Sept. 30, 2004.

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