NextMedia first liens should see high recovery, says S&P

Standard & Poor’s says its expects high recoveries on the first-lien loans of NextMedia, which filed for chapter 11 bankruptcy yesterday. It says that holders of the $182 of first lien loans should get recoveries of between 70% and 90%. However, holders of the $80 million of second lien loans from the same issuer, NextMedia Operating, will fair much worse with recoveries of between 0% and 10%.

NextMedia Operating filed for a pre-packaged bankruptcy, which will reduce its debt by $135 million, with both first liens and unsecured creditors being paid in full, while second-lien lenders get 95% of the company’s equity.