S&P: Salem on watch

Standard & Poor's said it placed its B- corporate credit rating for Salem Communications Corp., as well as the CCC issue-level rating on the holding company subordinated notes, on Creditwatch with negative implications.

"The Creditwatch listing reflects its concerns regarding the company's need for comprehensive intermediate-term refinancing by mid 2010," said S&P credit analyst Michael Altberg.

The company's senior secured credit facilities consist of a $75 million term loan B ($71.6 million outstanding as of March 31) maturing March 10, 2010 and a $165 million term loan C ($160.8 million outstanding) maturing June 30, 2012, the agency said.

Salem's $90.6 million 7.75% senior subordinated holding company notes mature on Dec. 15, 2010 and, as a result, the term loan C will be due on June 15, 2010. For this reason, the agency said it expects that the company will need to refinance its entire capital structure at the end of this year or early next year.

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