S&P gives BBB- to Discovery Communications notes

S&P said it assigned its BBB- issue-level rating to Discovery Communications LLC's proposed senior unsecured debt securities.

The company plans to split the benchmark-sized offering into tranches ranging from two years to 40 years, and it will use the proceeds to fund its acquisition of Scripps Networks Interactive Inc.

Discovery's parent, Discovery Communications Inc., provides an unconditional guarantee for the notes, as it does for the company's other public debt.

The BBB-/A-3 corporate credit ratings and negative outlook on Discovery remain.

“The ratings reflect the combined company's increased portfolio of key domestic and international cable networks; its significant international scale (36% of pro forma revenue) and the opportunity it has to leverage that scale to accelerate international distribution of Scripps networks; and its above-average domestic EBITDA margins compared with those of its peers due to its focus on lower cost unscripted programming,” the agency said in a news release.

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