The News America Inc. subsidiary of News Corporation announced a private placement of $2.5 billion of new debt in two issues. Moody’s Investors Service immediately gave the new bonds investment grade ratings.
News America sold $1 billion of 4.5% senior notes due 2021 and $1.5 billion of senior notes due 2041. The company said the proceeds will be used for general corporate purposes and to refinance near-term debt maturities.
Moody’s assigned a Baa1 rating to both new issues.
“While the transaction will increase debt levels, profitability has and is expected to continue improving, and we anticipate that the company’s total debt-to-EBITDA leverage over the long-term will remain consistent with targets aligned with News Corp.’s Baa1 long-term rating and stable outlook,” said Moody’s Sr. VP Neil Begley.
News Corporation had reported this month that net income nearly doubled in its most recent quarter.