Chancellor Media's Outlk to Neg by S&P; Rtgs Affirmed.NEW YORK--(BUSINESS WIRE)--Standard & Poor's CreditWire 9/1/98--Standard & Poor's today revised its outlook on Chancellor Media Corp. to negative from stable. The ratings of Chancellor and its subsidiary were 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. , as listed below. The outlook revision follows Chancellor's announcement of its pending debt-financed purchase of the assets of the Whiteco Outdoor Advertising division of Whiteco Industries, Inc. for $930 million. Standard & Poor's is concerned about the increased leverage and decreased interest coverage resulting from the company's recent acquisitions. Further concerns relate to the significant amount of internal consolidation that must take place given this and other recently announced multimedia asset and company combinations. Upon completion of the merger, Chancellor will own and operate 35,000 outdoor displays and will be one of the top five U.S. outdoor advertising companies. The company will potentially derive strength from cross-ownership of outdoor displays in 54 markets where it will have broadcast operations. While Chancellor has aggressively assembled as·sem·ble v. as·sem·bled, as·sem·bling, as·sem·bles v.tr. 1. To bring or call together into a group or whole: assembled the jury. 2. a portfolio of multimedia businesses capable of producing strong cash flows, its financial risk has grown in recent months. Standard & Poor's expects pro forma earnings pro forma earnings Income not necessarily calculated in accordance with generally accepted accounting principles. For example, a company might report pro forma earnings that exclude depreciation expense and nonrecurring expenses such as restructuring costs. before interest, taxes, depreciation, and amortization coverage of interest and payment-in-kind preferred dividends preferred dividend n. a payment of a corporation's profits to holders of preferred shares of stock. (See: preferred stock) to be around 1.5 times. OUTLOOK: NEGATIVE The outlook reflects Chancellor's increasing financial risk and the significant amount of internal consolidation that must occur given recent and pending acquisitions beyond its core radio operations. New businesses provide opportunities for longer-term strength; however, further weakening weak·en tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak  en·er n. of key credit measures caused by additional
acquisitions or business performance could result in a ratings
downgrade DowngradeA negative change in the rating of a security. Notes: For example, an analyst may downgrade a stock from strong buy to buy, or a bond rating agency may downgrade a bond from AAA to AA. . -- CreditWire -0- RATINGS AFFIRMED Chancellor Media Corp. Corporate credit rating BB- Preferred stock B Chancellor Media Corp. of Los Angeles Bank loan rating BB- Subordinated debt B Preferred stock B CONTACT: Eric Geil, 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) 212-208-5648 For more information on criteria or subscriptions: http://www.ratings.standardpoor.com |
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