Moody’s gives eOne CFR Ba3, notes B1

Moody's Investors Service said it assigned a Ba3 corporate family rating and a Ba3-PD probability of default rating to Entertainment One Ltd. (eOne) and a B1 rating to its £285 million senior secured notes due 2022.

The rating is one notch lower than the corporate family rating due to the presence of £100 million of contractually senior revolving credit facility due 2020 (unrated) in the company's capital structure.

The outlook is stable.

Moody’s said the corporate family rating considers: (a) The company's market leading position as a multi-territory independent film distributor with an extensive library of content rights to exploit; (b) strong relationships with cinemas, retail distributors and media platforms which leave eOne well placed to monetize content rights across all media windows; (c) revenue diversity from a large portfolio based film distribution model that ensures margin stability and an advantageous funding model for TV production; (d) solid growth potential for eOne's Television business which accounts for 42% of overall revenues; and (e) eOne's financial policy of managing its reported net leverage (as defined by the company) broadly between 1 time and 2 times while pursuing add-on acquisitions and investments necessary to execute its well defined future growth strategy.

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