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S&P rates Videotron notes BB
Standard & Poor's said it assigned Videotron Ltee.'s (BB/stable) proposed C$300 million of senior notes due July 15, 2021 a BB rating, with a recovery rating of 3, indicating meaningful (50%-70%) recovery.
The notes and the guarantees are senior unsecured obligations of Videotron, ranking equally with all existing and future unsecured unsubordinated debt of the company. Videotron is a 100%-owned subsidiary of Quebecor Media Inc.
Proceeds from the proposed C$300 million notes offering will be used to finance the redemption and retirement of a portion of Videotron's issued and outstanding 6 7/8% senior notes due 2014, to finance the settlement and termination of related hedging contracts and for the payment of related transaction fees and expenses.
The ratings on Quebecor Media reflect the credit risk profile of the company and its consolidated subsidiaries, including 100%-owned Videotron, the largest cable operator in Quebec and 100%-owned Sun Media, the agency said.
The Quebecor Media ratings reflect significant financial risk profile, which is characterized by an aggressive financial policy given the company's acquisitive nature and historically high tolerance for debt and relatively weaker cash flow protection measures, the agency added.
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