Moody's: AMC Networks Ba3, loans Ba2, notes B2

Moody's Investors Service said it assigned AMC Networks, Inc. a Ba3 corporate family rating and Ba3 probability of default rating, as well as Ba2 (LGD 3, 36%) ratings to the company's $2.225 billion senior secured credit facilities and a B2 (LGD 5, 89%) rating to the company's $700 million senior unsecured notes due 2021.

The new credit facilities, consisting of a $500 million revolver due 2016, a $1.16 billion term loan A due 2017 and a $565 million term loan B due 2018, will be guaranteed by AMC's subsidiaries.

The company is a newly formed independent entity, which will include the current businesses of Rainbow National Services, LLC, which is being spun off from Cablevision Systems Corp.

The proceeds will be used to refinance all of Rainbow's existing debt of about $1.04 billion, along with a one-time distribution of $1.25 billion to Cablevision and for general corporate purposes.

Upon close of transaction, all ratings for Rainbow will be withdrawn.

The outlook is stable.

The ratings reflect the company's positive and reliable free cash flow generation, aided by the contractual nature of more than 50% of the company's revenue, which is generated by carriage fees from pay-TV providers, Moody's said.

The ratings also are impacted by AMC's relatively high pro forma adjusted leverage of about 6x, the agency said.

These risks remain balanced by the company's desirable and fully distributed cable networks, Moody's added.

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