Moody's cuts Bonten loans to B1, notes to Caa2

Moody's Investors Service said it affirmed the B3 corporate family and probability-of-default ratings for Bonten Media Group Inc. and assigned a B1 rating (LGD2, 26%) to its proposed senior secured first-lien credit facility.

The agency also downgraded the existing first-lien bank debt rating to B1 from Ba3 and the senior subordinated notes rating to Caa2 (LGD5, 81%) from Caa1.

The outlook is stable.

Moody's said the B3 rating reflects Bonten's lack of scale, substantial revenue and cash flow concentration in three key markets, limited free cash flow and high leverage.

The rating also reflects cyclicality of advertising spending and long-term secular pressures, the agency added.

Bonten's leading position in most of its markets, the substantial contribution of local advertising to total revenue and diverse network affiliations support ratings, Moody's noted.

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