Moody's rates RCN loan B3

Moody's Investors Service said it rated the proposed bankruptcy exit financing being arranged for RCN Corp. and assigned B3 senior implied and SGL-2 liquidity ratings for the company. The outlook is stable.

Moody's rates RCN's $25 million first-lien senior secured letter of credit facility due 2009, $330 million first-lien senior secured letter tern loan due 2011 and senior implied rating B3 and senior unsecured issuer rating Ca.

Moody's said the rating reflects the company's high leverage, limited medium-term liquidity, concentration of cash flow in the Boston and Lehigh Valley markets coupled with a questionable future in other markets, intense competition from established cable operators and regional bell operating companies with greater scale and financial flexibility and uncertainty with respect to the value of the company's assets.

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