Moody’s rates CBS Radio loan Ba3

Moody's Investors Service said it assigned CBS Radio Inc.'s proposed $500 million term loan B-1 a Ba3 rating and affirmed the B1 corporate family rating.

The existing revolver and term loan ratings were affirmed at Ba3 and the senior notes were affirmed at B3.

The outlook remains stable.

Proceeds from the proposed term loan will be used to repay the existing term loan and redeem preferred stock at Entercom Communications Corp. upon completion of the merger between CBS Radio and Entercom that was announced on Feb. 2.

“The transaction is expected to close in the second half of 2017 with Entercom being the surviving entity. CBS shareholders are expected to own 72% of the combined entity with Entercom shareholders owning a 28% position,” the agency said in a news release.

“The existing debt at CBS Radio, including $960 million of term loan B and $400 million of senior notes are expected to remain outstanding as the change of control provision was not triggered by the transaction. The debt will be issued at CBS Radio and be secured by CBS Radio and Entercom's assets.”

Shortly after the closing of the transaction, Moody’s said it will withdraw all the ratings at CBS Radio and assign the debt ratings to the surviving entity, Entercom (B1 corporate family rating; stable).

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