Moody’s Investors Service gave an immediate thumbs-up to the move by Salem Communications to refinance all of its long term debt. The refi action is also being greeted by Standard & Poor’s, which changed its ratings assessment from “negative” to “developing.”
“The company is attempting to refinance its capital structure. If it is successful in doing so, we would expect to raise the corporate credit rating by one notch, to “B” with a stable outlook,” S&P stated.
The credit ratings firm has assigned a “B” rating to the proposed $300 million offering of senior secured second-lien notes due 2016, with the caveat that the rating could be withdrawn if the proposed bond sale is not completed. In that case, the company’s corporate rating could be lowered, rather than raised.