The E.W. Scripps Co.'s Proposed Secured Notes Rated 'BB-' (Recovery: '1'), Unsecured Notes Rated 'CCC+' (Recovery: '6')

CHICAGO (S&P Global Ratings) Dec. 14, 2020--S&P Global Ratings today assigned its 'BB-' issue-level rating and '1' recovery rating to Cincinnati-based TV broadcaster The E.W. Scripps Co.'s proposed $700 million senior secured notes due 2029 and its 'CCC+' issue-level rating and '6' recovery rating to the company's proposed $500 million senior unsecured notes due 2031. The '1' recovery rating on the senior secured notes indicates our expectation for very high (90%-100%; rounded estimate: 95%) recovery for lenders in the event of a payment default. The '6' recovery rating on the senior unsecured notes indicates our expectation for negligible (0%-10%; rounded estimate: 0%) recovery for lenders in the event of a payment default. Scripps plans to use the proceeds from these

...and all debt includes six months of prepetition interest. - We value Scripps on a going-concern basis using a 6.5x multiple of our projected emergence EBITDA, which is 0.5x lower than the multiple we use for the larger television broadcasters we rate that typically have a higher percentage of No. 1 and No. 2-ranked stations, more market duopolies, and are less reliant on advertising revenue. Simplified waterfall - EBITDA at emergence: About $435 million - EBITDA multiple: 6.5x - Gross recovery value: About $2.84 billion - Net recovery value for waterfall after administrative expenses (5%): About $2.69 billion - Estimated senior secured debt claims: About $2.76 billion - Value available for senior secured debt: About $2.69 billion - --Recovery expectations: 90%-100% (rounded estimate: 95%) - Estimated senior unsecured debt claims: About $1.5 billion - Value available for senior unsecured debt: Negligible - --Recovery expectations: 0%-10% (rounded estimate: 0%)...

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