Moody's Investors Service on Tuesday upgraded Spanish-language broadcaster Univision Communications Inc.'s credit rating to B2 from B3, citing the reduction in the company's debt that will come once Televisa converts $1.125 billon of debt to warrants that can be exchanged for common stock. Univision filed for an initial public offering last week. "Univision's B2 Corporate Family Rating incorporates its high financial leverage (albeit improving), event risk related to ownership by financial sponsors, leading market positions in Spanish-language media within the U.S., an increasing percentage of revenue coming from recurring retransmission fees, improved EBITDA margins, and good growth prospects over the next two years," the rating agency said in a statement. The B2 rating is still a full five notches into junk territory. The note conversion will reduce the company's debt-to-EBITDA ratio to 7.8 times from 9.0 times, said Moody's. See also: Five things to know about Univision ahead of its IPO
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