TORONTO – Beleaguered Canwest Limited Partnerships (CLP) had its probability of default rating cut yet again.
Moody’s Investors Service downgraded its rating to Ca/LD from Caa2, and its corporate family to Caa3 on news that the company "has decided to not make payments totaling approximately $10 million due under its senior secured credit facility" on May 29, 2009, the end of the company’s fiscal quarter.
Moody’s decision said that the move suggests that CLP “has chosen to force the issue with its bank lenders, and is also likely an indication that ongoing negotiations with the bank lenders were not going well”. Given the recent experience of parent company Canwest Media, this step was “likely unavoidable”, Moody’s said.
The company’s outlook was also changed to ‘negative’, from ‘under review’.
In related news, Moody’s said that the on-going rating review for CW Media Holdings Inc. will continue, and will likely only be completed when details of an anticipated restructuring of Canwest Media’s balance sheet are known.
