Financial move could ease McClatchy’s pain

Efforts to refinance a portion of its debt could result in slightly better ratings for McClatchy stock by Moody’s and Standard & Poors, according to Fitz & Jen.

“McClatchy is proposing to amend its credit facility to allow it to issue about $875 million in new senior secured debt that would be used to pay down amounts in the facility, refinance public debt maturities and stretch out the credit facilities maturity to 2013 from 2011 now,” the Editor & publisher editors’ blog says.

“[T]his could result in the company’s liquidity position strengthening to a point where we may no longer believe a debt restructuring is imminent,” says an S&P analyst.

Neither service has made the final call, and both rate the publisher’s stock as junk, but “Pushing out maturities would provide McClatchy additional flexibility to manage through the advertising downturn and realize the potential de-leveraging benefits of a cyclical advertising recovery,” says a Moody’s analyst.

Fitz & Jen has both services’ full statements at the link at top.

McClatchy stock was down a penny on the day Thursday at $3.39.

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