Moody's affirms Cablevision, unit

Moody's Investors Service said it affirmed all ratings for Cablevision Systems Corp. and CSC Holdings Inc., a wholly owned subsidiary, following the company's announcement of plans for subsidiary Rainbow DBS to sell certain satellite assets to EchoStar Communications Corp. for about $200 million.

The outlook remains negative based on lingering concerns about the SEC investigation of accounting improprieties.

Ratings affirmed include Cablevision Systems Corp.'s $500 million new floating-rate notes due 2009 at B3, $1 billion senior unsecured notes due 2012 at B3, senior implied rating of Ba3, issuer rating of B3, and liquidity rating of SGL-2. Moody's also affirmed CSC Holdings Inc.'s $4.2 billion aggregate senior unsecured notes at B1 and $250 million 10.5% senior subordinated debentures due 2016 at B2.

Moody's said the ratings for Cablevision continue to reflect the company's high financial leverage, only modest coverage of interest, and heightened competitive pressure from DirecTV, EchoStar, and the regional Bell operating companies.

Cablevision's ratings benefit, however, from the core cable operations' continued strong cash flow margins; the prospect of cash flow growth as the company increases penetration of its internet and voice products; and strong asset value associated with its technologically upgraded network and well clustered subscriber base, which provides good coverage of the company's outstanding obligations, Moody's said.

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