U.S.-based Netflix Inc. has proposed $400 million senior notes due 2021. The company expects to use proceeds from the proposed transaction to repay existing debt and for general corporate purposes. We have revised our outlook on the 'BB-' corporate credit rating to negative. We have also assigned the prosed debt an issue-level rating of 'BB-' with a recovery rating of '3'. The rating outlook is negative based on an increase in debt leverage as well as our expectation for negative discretionary cash flow in 2013 and possibly into the first half of 2014, resulting from increased investments in original programming. On Jan. 29, 2013, Standard&Poor's Ratings Services revised its 'BB-' rating outlook on Los Gatos, Calif.-based Netflix Inc.
