Fitch lowers iHeartCommunications

Fitch Ratings said it downgraded iHeartCommunications, Inc.'s long-term issuer default rating to C from CC.

Fitch also said it downgraded the senior secured term loans and senior secured priority guarantee notes to C with recovery rating of RR4 from CC with recovery rating of RR4, reflecting their inclusion in the proposed exchange offers.

Fitch also said it affirmed the issuer default ratings for Clear Channel Worldwide Holdings, Inc. and Clear Channel International BV at B.

Both Clear Channel companies are indirect, wholly-owned subsidiaries of Clear Channel Outdoor Holdings, Inc., iHeart's 89.9% owned outdoor advertising subsidiary.

The outlook is stable.

The downgrades reflects news that iHeartCommunications started a global restructuring effort targeting about $14.6 billion in debt, including all of the outstanding term loans and priority guarantee notes, as well as the senior notes due 2021.

The agency said it views the proposed exchange offers as distressed-debt exchanges given the belief that the present capital structure is unsustainable and that the exchange offers are being conducted largely to avoid bankruptcy.

Fitch said it will downgrade the issuer default rating to RD (restricted default) upon the completion of the exchange offers. The rating will then be upgraded after the distressed debt exchange, the agency said.

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