...Moody's downgraded the company's corporate family rating and probability of default rating two levels, to Caa1 from B2. Its senior secured bank credit facility rating was cut to B1 from Ba2 and senior unsecured notes fell to Caa2 from Caa1. The downgrades affect about $2.2 billion of debt.
The rating outlook is negative.
Moody's is concerned about Sacramento, Calif.-based McClatchy's debt level becoming "unsustainable" and it said there's a heightened risk that continued declines in revenue could make it breach debt covenants or trigger a restructuring over the next 12 to 24 months.
Moody's expects McClatchy's EBITDA to fall by about 30 percent this year.
Looks like Moody's wasn't swayed by Pruitt's lame answer about the chances of McClatchy breaching debt covenants in 2009.
Hat tip: email