S&P affirms Knology

Standard & Poor's said it affirmed its ratings, including the B corporate credit rating, for Knology Inc.

The agency said that this follows Knology's announcement that it signed a definitive agreement to acquire the stock of unrated PrairieWave Communications for $255 million in cash.

The outlook remains stable.

Although the amount of new debt to fund the acquisition has yet to be determined, the agency said that the affirmation reflects that Knology can support a modest increase in leverage at the current rating level because of its recent operating performance and its expectations that prospects for discretionary cash flow generation will remain good over the next couple of years.

S&P noted that the ratings for Knology reflect the company's vulnerable market position, its uncertain long-term sustainability in providing undifferentiated services in a fiercely competitive landscape and its small scale, which limits its pricing power in negotiating programming contracts.

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