Moody’s rates Mood Media notes Ca

Moody's Investor's Service said it affirmed its ratings for Mood Media Borrower, LLC, including the company's Caa3 corporate family rating, the Caa3-PD probability of default rating and the Ca rating for its senior secured second-lien notes.

The agency assigned a Ca rating to the company's incremental senior secured second-lien notes.

The outlook remains negative.

The actions follow the company's debt-funded acquisition of Focus Four, one of Mood Media's largest franchisees, for $14.9 million, Moody’s said.

Funding was comprised of a $12.9 million incremental first-lien term loan (unrated) and $12.9 million of additional second-lien notes, with the excess amount added to the balance sheet to support the company's strategic initiatives.

"Moody's continues to view Mood Media's capital structure as untenable over time, despite the acknowledged modest improvement in near-term liquidity stemming from excess cash placed on the balance sheet in conjunction with the incremental debt issuance, an agreement with financial sponsors to reinvest in the business, and the loosening of financial covenants," Jonathan Teitel, Moody's lead analyst for the company, said in a news release.

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