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BOTH S & P AND MOODY'S UPGRADE THE RATING OF MUSICLAND'S DEBT; UPGRADES IMPROVE THE COMPANY'S IMPLIED SENIOR RATING

 MINNEAPOLIS, June 7 /PRNewswire/ -- Standard and Poor's today improved the implied senior rating of Musicland Stores Corporation (NYSE: MLG) and its wholly owned subsidiary, The Musicland Group, Inc., to 'BB' from 'BB-'. Musicland Stores Corporation also received improved ratings on its $53 million junior subordinated debt from both S & P and Moody's. The raise in ratings means that under the terms of Musicland's long-term bank credit agreement, it will realize a 1/2-percentage-point savings on its borrowings.
 S & P raised its ratings on Musicland's $53 million subordinated debt to 'B plus' from 'B'. Moody's raised its rating on Musicland's $53 million subordinated debt to 'B1' from 'B2'.
 S & P also assigned its 'B plus' rating on The Musicland Group's offering of $110 million of senior subordinated notes due 2003. Moody's assigned a rating of 'B1' to the same note offering.
 Headquartered in Minneapolis, Musicland Stores Corporation is the leading specialty retailer of pre-recorded home entertainment products in the United States. As of March 31, 1993, the company operated 1,137 stores in 49 states, Puerto Rico and the United Kingdom.
 A registration statement relating to The Musicland Group's current offering of $110 million of senior subordinated notes due 2003 has been filed with the Securities and Exchange Commission but has not yet become effective. These securities may not be sold nor offers to buy be accepted prior to the time the registration becomes effective. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any State in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such State.
 The funds raised from the sale of these securities will be used to redeem the $53 million junior subordinated debt and for general corporate purposes including capital expenditures.
 A written prospectus may be obtained from the underwriters, Donaldson, Lufkin & Jenrette Securities Corporation and J.P. Morgan Securities Inc.
 -0- 6/07/93
 /CONTACT: Marcia Appel of Musicland, 612-932-7742/
 (MLG)


CO: Musicland Stores Corporation ST: Minnesota IN: REA SU:

DB -- MN025 -- 6277 06/07/93 18:08 EDT
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Publication:PR Newswire
Date:Jun 7, 1993
Words:364
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