S&P lowers Insight Midwest loan

Standard & Poor's said it lowered its secured bank loan rating on Insight Midwest Holdings LLC's $1.975 billion facility to BB from BB+. In addition, the loan was assigned a recovery rating of 2.

Given cable TV subscriber losses experienced by many of the cable operators over the past several quarters because of aggressive marketing by direct broadcast satellite players, S&P said it now incorporates the assumption of subscriber losses in the bank loan analysis for Holdings' secured facility.

Ratings for cable TV company Insight Midwest LP, including the BB corporate credit rating, were affirmed. Ratings on 50% owner/operator Insight Communications Inc. (Insight), including the B- corporate credit rating, also were affirmed. The outlook is negative.

"Despite a near-investment-grade business risk, Insight Midwest's ratings are constrained by the company's aggressive debt profile," said S&P credit analyst Catherine Cosentino. Debt to annualized EBITDA for the six months ended June 30, 2004 was relatively high for the rating, at about 6.1x, exclusive of intercompany debt, but inclusive of management fees.

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