Time Warner Inc. -- Moody's says Time Warner's financing deal with CME will not impact its credit ratings

New York, March 03, 2014 -- Moody's Investors Service said that Time Warner Inc.'s ("Time Warner") Baa2 senior unsecured debt rating, Prime-2 short term debt rating and stable outlook will not be affected by its financing agreement with Central European Media Enterprises Ltd. ("CME" -- Caa1 Corporate Family Rating, ratings are on review for possible downgrade). In 2009, Time Warner acquired a 31% stake CME, a leading broadcaster operating various networks throughout Central and Eastern Europe, for USD246 million, and has subsequently increased its voting interest to 49.9%. On February 28, 2013, CME announced that it will refinance its 11.625% senior notes due 2016 with proceeds from a rights offering and other financing transactions with Time Warner. As part of the rights offering, CME's shareholders will receive non-transferable rights to purchase certain number of units consisting of senior secured notes and warrants to purchase shares of the company at a specified exercise price. Time Warner has agreed to backstop the rights offering and purchase additional units from CME in a separate private placement transaction. As part of the financing arrangements, Time Warner will also provide CME a $115 million senior secured revolving credit facility and a $30 million term loan to enhance CME's liquidity position. The financing transactions are subject to the consent of the holders of the 9.0% senior secured notes due 2017 issued by CME's subsidiary and the rights offering and issuance of related warrants to Time Warner are subject to approval by CME shareholders.

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