PE Debt Watch (Upgrades and Downgrades)

As usual, we have a week’s worth of ratings actions on the debt of LBO-backed companies from ratings agencies Standard & Poor’s Ratings Services and Moody’s Investors Service.

Company: Penton Business Media Holdings, Inc.
Sponsor: MidOcean Partners and Wasserstein Ventures
Action: Moody’s and S&P downgraded the company’s ratings to D in tandem with its Chapter 11 bankruptcy filing.
Highlight: From Moody’s: “Penton has received acceptance of its prepackaged Plan of Reorganization by the requisite number of first and second lien lenders. In accordance with the terms of the Plan, the restructuring would result in the elimination of $270 million of debt (all of the second lien facility).” From S&P: “The weak operating performance raised leverage, weakened interest coverage, and reduced liquidity. We believe these factors contributed to the company’s decision to file for bankruptcy protection.”

Company: Clear Channel Communications, Inc.
Sponsor: Bain Capital LLC and Thomas H. Lee Partners LP
Action: Moody’s upgraded the company’s corporate family rating to Caa2 from Caa3. Additionally, Moody’s upgraded Clear Channel’s bank credit facilities to Caa1 from Caa2 and its speculative grade
liquidity rating to SGL-2 from SGL-4.
Highlight: The upgrades reflect Moody’s expectation that while the company’s capital structure remains unsustainable in the intermediate-term, a full restructuring or bankruptcy filing is no longer imminent.

View Past Downgrade and Upgrade Lists Here