Moody's Downgrades MediaNews Credit Rating

By: Mark Fitzgerald Citing high debt levels and continuing advertising weakness, Moody's Investor Service recently downgraded MediaNews Group Inc.'s credit rating and warned it may do the same with the Tribune Co.'s rating.

Moody's reduced its rating on MediaNews' senior unsecured debt to "B2," in the midrange of its noninvestment-grade credit ratings. The agency said it was concerned about the $976 million in long-term debt held by the Denver-based privately owned chain.

Moody's said it may downgrade its investment-grade "A2" rating on Tribune's senior unsecured debt and its "Prime-1," or highest, rating on the Chicago-based media giant's short-term debt. Moody's said Tribune, with about $4 billion outstanding, had been slow to reduce debt relative to its operating cash flow.