Moody's rates Charter notes, loan

Moody's Investors Service said it assigned B2 ratings to the proposed $6.5 billion of combined new senior secured bank credit facilities and $1.5 billion of new senior secured second lien notes of Charter Communications Operating LLC, an indirect subsidiary of Charter Communications Inc.

Moody's also confirmed all existing ratings for the company and its subsidiaries, with the exception of the former B2 ratings for the current subsidiary bank credit facilities, which are being withdrawn in conjunction with the assumed successful completion of the proposed refinancing transactions.

Moody's said the ratings broadly incorporate the company's high financial risk and moderate (albeit growing) business risk, as reflected in very high balance sheet leverage and low coverage levels; relatively weak operating performance, as specifically evidenced by continued subscriber losses, slower advanced service growth, and only modest organic cash flow growth after adjusting for extraordinary items; and heightened competition from direct broadcast satellite (DBS) operators and regional Bell operating companies (RBOCs), at present and as anticipated in future periods.

However, the ratings also incorporate Moody's belief in the still high value of the company's assets, including its sizable (albeit still shrinking) subscriber base and largely upgraded network architecture and infrastructure; the prospect of improved operating performance, including better operating cash flow growth and the potential transition to positive free cash flow in future periods; and evidence of renewed market access and a more adequate liquidity profile pro forma for recently completed and pending transactions.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.