S&P ups, withdraws All3Media; ups and rates DLG debt

Standard & Poor's said it raised its long-term corporate credit rating on All3Media Finance Ltd. to B+ from B. The agency subsequently withdrew the rating as the entity has become an operating subsidiary of DLG Acquisitions Ltd.

At the same time, S&P assigned its B+ long-term final corporate credit rating to DLG.

The outlook is stable.

In addition, the agency raised the issue rating on the £282 million first-lien term loan to B+ from B. The recovery rating on this loan is 3, indicating an expectation of meaningful (50%-70%) recovery prospects in the event of a payment default.

Finally, it assigned a B- issue rating to the €100 million second-lien term loan issued by DLG. The recovery rating on this loan is 6, indicating an expectation of negligible (0%-10%) recovery in the event of a payment default.

S&P said the rating reflects its view of DLG’s "highly leveraged" financial risk profile and "fair" business risk profile.

Post-acquisition, DLG's capital structure includes the £282 million first-lien term loan (which was moved up to DLG from All3Media Finance Ltd.), a €100 million second-lien term loan and £8 million drawn under the £38 million revolving credit facility. Meanwhile, S&P said it understands that the £516 million of subordinated preference certificates at the level of All3Media were retired as part of these transactions.

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