Moody's lowers Questex

Moody's Investors Service said it downgraded Questex Media Group, Inc.'s corporate family and probability-of-default ratings to Caa1 from B3 and its $30 million first-lien revolving credit facility due 2012 and $148 million first lien term loan due 2014 to B2 (LGD3, 30%) from B1 (LGD3, 32%). The $55 million second-lien term loan due 2014 was affirmed at Caa2 (LGD5) with a revised loss-given-default rate of 78% (formerly 82%).

The outlook was changed to negative from stable.

The agency said the downgrade and outlook change were prompted by a shortfall in third-quarter revenue and operating results compared to Moody's previous expectations, stemming mostly from Questex's advertising-based publications business. Meanwhile, a debt-financed acquisition in January 2008 along with earnout payments made in the second and third quarters has led to a significant increase in outstanding debt levels and a deterioration in liquidity, Moody's said.

The negative outlook further reflects macroeconomic and industry-wide trends that continue to affect end-market demand for advertising spending and Moody's concern that current conditions could lead to further declines in Questex's operating results, the agency said.

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