S&P: Mood Media loans B, CCC+

Standard & Poor's said it assigned a B long-term corporate credit rating to Mood Media Corp.

The outlook is stable.

S&P also assigned a B issue-level rating to Mood Media's proposed first-lien secured debt, consisting of a $390 million term loan due 2018 and a $25 million revolving credit facility due 2016. S&P assigned a recovery rating of 3 to the debt, indicating the expectation of meaningful (50%-70%) recovery.

S&P assigned the proposed $65 million second-lien senior secured term debt due 2018 a CCC+ issue-level rating and a 6 recovery rating, indicating the expectation of negligible (0%-10%) recovery for creditors in a default scenario.

The ratings on Mood Media reflect the company's lack of business diversity, the noncritical nature of its products, execution risk regarding integrating the two businesses, high debt leverage upon completing the transaction and the threat of substitution from competing alternatives, the agency said.

The ratings consider the company's leading global position in the business-to-business subscription music industry, good pro forma EBITDA margin and recurring revenue base from multiyear contracts, the agency added.

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