Capstar, SFX Ratings Put on S&PWatch Dev After Anncmnt.NEW YORK--(BUSINESS WIRE)--S&P CreditWire 8/26/97--Standard & Poor's today placed its ratings of Capstar Broadcasting Partners Inc. and SFX SFX Special Effects SFX Self Extracting (data compression) SFX SpreadFireFox (IRC) SFX Sound Effect(s) SFX Side Effects (counter-strike gaming clan) Broadcasting Inc. on CreditWatch with "developing" implications (see list below) following Capstar's announcement that it will purchase SFX for $1.2 billion. Developing implications mean that the ratings may be either raised or lowered. The CreditWatch listings reflect Capstar's recent announcement of its intention to purchase SFX for approximately $1.2 billion. The combination of the two radio groups will result in one of the largest radio operators in the country, with strong holdings in mid- mid- pref. Middle: midbrain. to large-sized markets. This combination will lead to substantial operating strength and market reach, which could have positive implications for the rating. However, both Capstar and SFX have aggressively pursued station acquisitions, and continued acquisition activity is expected. Both companies also have been comfortable with high debt usage, and Standard & Poor's expects that the combined entity will continue to rely heavily on debt financing Debt Financing When a firm raises money for working capital or capital expenditures by selling bonds, bills, or notes to individual and/or institutional investors. In return for lending the money, the individuals or institutions become creditors and receive a promise to repay even with the proposed equity infusion INFUSION, med. jur. A pharmaceutical operation, which consists in pouring a hot or cold fluid upon a substance, whose medical properties it is desired to extract. Infusion is also used for the product of this operation. Although infusion differs from decoction, (q.v. of $400 million from Capstar's parent company, Hicks Hicks , Edward 1780-1849. American painter of primitive works, notably The Peaceable Kingdom, of which nearly 100 versions exist. , Muse, Tate, and Furst. Continued high debt levels are likely to result in the corporate credit ratings being affirmed af·firm v. af·firmed, af·firm·ing, af·firms v.tr. 1. To declare positively or firmly; maintain to be true. 2. To support or uphold the validity of; confirm. v.intr. at the single-'B'-plus level, although the possibility of continued debt-financed acquisitions could lead to a lower rating. Resolution of the CreditWatch listing likely will occur following the completion of the acquisition of SFX, expected in early 1998, and will reflect the capital structure of the consolidated company. Failure to complete the acquisition will likely result in the affirmation A solemn and formal declaration of the truth of a statement, such as an Affidavit or the actual or prospective testimony of a witness or a party that takes the place of an oath. An affirmation is also used when a person cannot take an oath because of religious convictions. of the ratings of both companies, Standard & Poor's said. -- CreditWire -0- RATINGS PLACED ON CREDITWATCH WITH DEVELOPING IMPLICATIONS Capstar Broadcasting Partners, Inc. Corp credit rtg B+ Sr unsecd debt B- Pfd stk B- Capstar Radio Broadcasting Partners, Inc. Sub debt (gtd: Capstar Broadcasting) B- Commodore Media, Inc. Sub debt B- SFX Broadasting Inc. Corp credit rtg B+ Sub debt B- Pfd stk B- Bank loan rtg BB- CONTACT: Scott Dinsdale, New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of (1) 212-208-8933 |
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