Warner Music's $3 Billion Debt Upgraded To B1 'High Default Risk'


NEW YORK (Hypebot) – When Len Blavatnik's Access Industries bought Warner Music Group in 2011, it took on $3.05 billion in expensive debt. Now investment ratings firm Moody's has upgraded WMG's outlook slightly from B2 to B1, but with a "high default risk."

Moody's Investor Service has upgraded Warner Music Group Holdings business credit rating slightly from B2 to B1, which the rating service describes as a "highly speculative' investment. And while the world's third largest music group's outlook is considered "stable," Moody says that WMG's risk of defaulting on its loans is "high" (B1-PA).

Moody's Investor Service has upgraded Warner Music Group Holdings business credit rating slightly from B2 to B1, which the rating service describes as a "highly speculative' investment. And while the world's third largest music group's outlook is considered "stable," Moody says that WMG's risk of defaulting on its loans is "high" (B1-PA).

$3.05 Billion In Debt At Interest Rates As High As 13.75%

But WMG is still saddled with $3.05 billion in debt. Most of it is being carried at an average interest rate of 6.5% and comes due in the next 4 to 6 years. But $100 million of the debt, which come due in 3 years carries a whopping 13.75% interest rate.

The prime business borrowing rate currently sits at near record lows of 2.70%, with many companies able to borrow at prime +1 or 3.70%