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Moody's cuts EMI
Moody's Investors Service said it downgraded EMI Group plc's corporate family and senior debt ratings to B1 from Ba3. All ratings remain under review for downgrade.
The rating action follows Maltby Ltd.'s bid to buy EMI for £3.2 billion, approved by 90.3% of shareholders and scheduled to close in the third quarter. Moody's said it expects the company's already considerable debt load to increase as a result of the merger. EMI's debt-to-EBITDA ratio was 7.7 times for the financial year ended March 31.
Moody's review will focus on the new entity's capital structure and financial policies, the relative position of the rated instruments within the new capital structure and their relative ranking, along with the outlook for the global music markets and the company's operating plans, the agency said.
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