Standard & Poor’s places McClatchy on CreditWatch with positive implications
By APWednesday, January 27, 2010
S&P places McClatchy on positive CreditWatch
NEW YORK — Standard & Poor’s Ratings Services said Wednesday it has placed newspaper publisher McClatchy Co.’s “CC” rating on CreditWatch with positive implications.
A “CC” rating from S&P is non-investment grade, also referred to as “junk.”
Earlier Wednesday, McClatchy said most of its lenders have agreed to refinance its debt, and that it cut enough costs to turn a profit in the fourth quarter even as ad sales slumped.
The ratings agency said the positive CreditWatch placement reflects its expectation to raise the “CC” rating on the company to “B-” after the closing of the financing transactions. A “B-” rating is also non-investment grade.
“Although we anticipate some cyclical relief for McClatchy’s newspaper business in 2010, the expected ‘B-’ rating assumes that ad revenue will continue to decline at a low-single-digit rate in 2011 and 2012,” S&P said.
Shares of McClatchy rose 64 cents, or 13 percent, to close at $5.60.
