Moody's rates Regal add-on B3

Moody's Investors Service said it assigned a B3 (LGD 6, 91%) rating to Regal Entertainment Group's new $100 million add-on senior unsecured notes issue.

Regal is the publicly traded parent holding company of Regal Cinemas Corp.

Since the proceeds from the modest-sized new issue will be used to partially pay down the $1.09 billion balance of Regal Cinema's bank credit facility due November 2016, the transaction is neutral to Regal's consolidated credit profile.

Its B1 corporate family and probability of default ratings remain unchanged, along with its speculative grade liquidity rating at SGL-1.

Regal Cinemas' senior secured bank credit facility rating is unchanged at Ba2 with LGD 2, 22% revised from LGD 2, 24%; and senior unsecured regular bond/debenture at B2 with the LGD 4, 68% revised from LGD 5, 72%.

The outlook remains stable.

The add-on notes are rated at the same B3 level as the reference note issue, Moody's said.

The transaction continues a much needed re-balancing of Regal's consolidated credit profile that more evenly distributes debt capital among senior secured, senior unsecured and senior unsecured holding company instruments, which is a modestly positive development, the agency said.

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