Moody's cuts Media General

Moody's Investors Service said it downgraded Media General, Inc.'s senior unsecured rating to Ba1 from Baa3, senior unsecured shelf to prospective Ba1 from prospective Baa3 and preferred stock shelf to prospective Ba3 from prospective Ba2 and assigned the company a Ba1 corporate family rating.

The downgrade reflects the significant increase in Media General's debt-to-EBITDA leverage that will occur as a result of an acquisition, which Moody's believes has a high probability of closing.

The stable outlook reflects Moody's expectation that the company will reduce debt-to-EBITDA to a level below 4.0x by 2008 supported by the addition of the four NBC broadcast properties with good collective operating margins, incremental sales from new product development and enhanced printing capabilities, good business line diversity - 58% revenues from newspapers and 39% from broadcast - and improved cash generation available for debt service once capital expenditures begin to moderate after 2007.

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