Moody's drops Millennium New Jersey

Moody's Investors Service said it downgraded the corporate family and probability of default ratings for Millennium New Jersey Holdco, LLC to Caa3 from Caa2, concluding the review for downgrade commenced Jan. 16.

As Moody's said it expected, the company violated the maximum leverage covenant of its first and second-lien credit agreements for the fourth quarter 2008.

Millennium lacks sufficient liquidity to fund repayment of the about $150 million of loans should lenders exercise their legal rights to accelerate payment of their full outstanding balance, the agency added.

The downgrade of the probability of default rating reflects intensifying default risk, and the downgrade of the corporate family rating reflects continued deterioration of radio advertising revenue, with many radio operators reporting advertising revenue declines in excess of 20% for the first quarter of 2009, the agency said.

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