S&P assigns Dotdash Meredith, loan BB-

S&P said it assigned BB- ratings to Dotdash Meredith Inc. and its planned $1 billion senior secured term loan B. The loan’s recovery rating is 3. The company also plans to secure a $150 million senior secured revolving credit facility and a $350 million senior secured term loan A.

Dotdash, a wholly owned unit of IAC/InterActive Corp., agreed to buy Meredith Corp.’s national media group for $2.7 billion. The combined company will be Dotdash Meredith. IAC plans to contribute $1.4 billion in cash to help fund the deal.

“Our BB- issuer credit rating on Dotdash Meredith Inc. reflects the company's strong portfolio of brands, high amount of organic digital traffic compared to peers', favorable group support from IAC, and solid cash-flow generation. These factors are somewhat offset by the company's operations in a competitive and cyclical industry, its exposure to pay-for-performance revenue, its print business being in secular decline, and the significant execution risk tied to the integration of Dotdash and Meredith's national media group,” the agency said in a press release.

The outlook is stable.

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