S&P rates LBI Media loans B

Standard & Poor's said it assigned a B bank loan rating with a recovery rating of 2 to LBI Media Inc.'s proposed $260 million secured credit facilities and affirmed the company's B long-term corporate credit rating and CCC+ subordinated debt ratings. The outlook is stable.

Borrowings under the proposed facilities are expected to be used to refinance existing debt.

S&P said the ratings on LBI reflect its high leverage, cash flow concentration in a small number of large Hispanic markets, intense competition for audiences and advertisers from much larger rivals and nontraditional media and the potential for additional debt-financed acquisitions.

These risks are only partially offset by the margin and discretionary cash flow potential inherent in broadcasting, station asset values and broadly favorable Spanish-language advertising trends, the agency said. LBI is analyzed on a consolidated basis with its ultimate parent company, LBI Holdings I Inc.

LBI's consolidated debt to EBITDA was 7.8x at Dec. 31. While this ratio improved compared with almost 9x in 2004, S&P said the company's high leverage remains a key rating concern.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.