S&P lowers Media General

Standard & Poor's said it lowered the corporate credit on Media General Inc. to CCC+ from B-.

The agency also lowered the rating on the company's $300 million senior notes due 2017 to CCC+. The recovery rating remains unchanged at 4, indicating 30% to 50% expected recovery in a default.

The downgrade reflects an expectation that Media General could face difficulties in maintaining covenant compliance in 2012, S&P said.

The loan covenant step-downs and continued weakness in the U.S. economy could cause the company to violate covenants in late 2012 if it is unable to refinance or amend covenants, S&P said.

The company's business risk is considered vulnerable, based on structural pressure on the U.S. newspaper industry, TV broadcasting's mature long-term growth prospects and increased competition for audience and advertisers, the agency said.

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