S&P rates Consolidated loan B+

Standard & Poor's said that it assigned a B+ issue-level rating and 3 recovery rating to Consolidated Communications Inc.'s new term loan B and revolving credit facility.

The new term loan represents an extension of $409.1 million of the existing $880 million term loan B to a Dec. 31, 2017 maturity from the previous Dec. 31, 2014. The revolving credit represents the extension of $38.7 million of the existing $50 million revolving credit to a May 2016 maturity from the current Dec. 31, 2013 maturity.

With the extension, the company also amended various terms of the existing bank credit facilities, including some financial maintenance covenant definitions, the agency said. However, even with these changes, parent Consolidated Communications Holdings Inc.'s liquidity is less than adequate since the EBITDA covenant cushion with respect to the leverage covenant will continue to be less than 15% for the next year.

Given the company's relatively stable cash flow and lack of major debt maturities until 2014, S&P said it does not expect a covenant breach.

The B+ corporate credit rating remains unchanged.

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