NEW YORK (AFX) - Two credit-rating agencies downgraded the debt of Univision Communications Inc. Tuesday, citing concerns over the debt the media company would take on in a planned buyout.
A consortium of investors plans to buy the nation's largest Spanish-language broadcaster for $12.3 billion in cash, which would hurt the company's credit profile, according to Moody's Investors Service and Fitch Ratings. Both agencies also said they could downgrade the company's ratings several more notches, as they review the proposed transaction.
Moody's downgraded Univision's senior unsecured regular bond/debenture rating to 'Baa3' from 'Baa2,' among other downgrades. Fitch downgraded Univision's issuer default rating and senior unsecured debt ratings to 'BB' from 'BBB-.'
Univision's bond indentures contain no requirements for bondholder approval of a change in control, both agencies said. The company will likely have $1.2 billion of existing bonds remaining outstanding after the transaction, Moody's said.
Univision closed up $1.97, or 6.2 percent, at $34 on the New York Stock Exchange. The stock has traded between $23.52 and $36.67 over the past 52 weeks.
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