Moody's Boosts Clear Channel's Rating
February 15, 2010 at 4:30 AM (PT)
CLEAR CHANNEL COMMUNICATIONS has been bumped up by MOODY'S INVESTORS SERVICE, which raised its ratings to CAA2 on the debt-laden company on its expectations that a "full restructuring or bankruptcy filing is no longer imminent," reports THE WALL STREET JOURNAL. The move comes 11 months after MOODY'S cut CLEAR CHANNEL to the C-range on expectations CLEAR CHANNEL would violate its lender covenants and on the likelihood of a debt restructuring.
Things aren't totally rosy though -- because last year as credit markets rallied, CLEAR CHANNEL sold $2.5 billion in new debt, using proceeds to pay off other borrowings and giving the company some much needed breathing room. MOODY'S points out that is unlikely to happen again.
THE JOURNAL recaps CLEAR CHANNEL's financial situations as having "been weighed down by billions in leveraged-buyout debt and a business dependent on advertising as the economy deteriorated and credit markets froze up. In the third quarter, the company's parent reported a slightly narrower loss as revenue slid 17%, a lessened decline from earlier in 2009. Fourth-quarter results will likely be released next month."
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