Research Update: Beasley Broadcast Group Inc. Ratings Placed On CreditWatch Positive; New Notes Assigned Preliminary 'B-' Rating

Radio broadcaster Beasley Broadcast Group Inc. is issuing $280 million of senior secured notes due 2026 and plans to use the proceeds to refinance its entire capital structure. If the transaction is completed, it would eliminate the company's near-term covenant and maturity risks and, depending on the interest rate, could allow the company to generate free operating cash-flow (FOCF) to debt in the low- to mid-single digit percent range. This would give Beasley an extended runway to return leverage to below 5x from well over 6x currently. We are placing the 'CCC+' issuer credit rating on CreditWatch with positive implications. At the same time, we are assigning a preliminary 'B-' issue-level rating and '3' recovery rating to the proposed $280

...- Radio broadcaster Beasley Broadcast Group Inc. is issuing $280 million of senior secured notes due 2026 and plans to use the proceeds to refinance its entire capital structure. - If the transaction is completed, it would eliminate the company's near-term covenant and maturity risks and, depending on the interest rate, could allow the company to generate free operating cash-flow (FOCF) to debt in the low- to mid-single digit percent range. This would give Beasley an extended runway to return leverage to below 5x from well over 6x currently. - We are placing the '###+' issuer credit rating on CreditWatch with positive implications. - At the same time, we are assigning a preliminary 'B-' issue-level rating and '3' recovery rating to the proposed $280 million senior secured notes. The '3' recovery rating indicates our expectation of meaningful (50%-70%; rounded estimate: 60%) recovery for lenders in the event of a payment default. - We expect to resolve the CreditWatch placement when the...

Research Update