Moody's: Gallery Media view positive

Moody's Investors Service said it changed the outlook on the Caa1 corporate family rating and existing bond ratings of Gallery Media Group Ltd., formerly known as Rapsod Trade Ltd., to positive from stable.

The change in outlook reflects the company's developing strong track record, the ongoing growth in Gallery's business and Moody's expectation that the financial profile of the company will continue to improve as the new acquisitions are consolidated, the agency said.

Gallery's positioning within its rating category has strengthened as a result of the company's intensive expansion in Moscow and the Russian regions and the successful integration of new businesses, Moody's said.

The recent close of a payment-in-kind loan poses more potential for execution risk, Moody's said, given the need to demonstrate business growth and improved performance to pursue an initial public offering within two years, the proceeds of which would presumably be used to retire the PIK loans.

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