Omnicom's $2 Bil. Credit Line Gets An 'A-' From S&P

Last week, Standard & Poor’s Ratings Services assigned an “A-” rating to Omnicom Group’s new $2 billion credit line, which has replaced its former $2.035 billion facility.

The new arrangement comprises a five-year facility that provides for up to $1.5 billion in borrowings and is available through May 2009, and another, 364-day line that allows for up to $500 million and is available through May 2005. Under the 364-day line, Omnicom may elect to covert the borrowings at maturity into a one- year term loan.

“The rating on Omnicom reflects the company’s strong position among the top three worldwide advertising agency holding companies, good geographic and business diversity, and sustained discretionary cash flow, notwithstanding challenges in the advertising and marketing services environment in the last three years,” S&P analyst Alyse Michaelson wrote in a statement.

She added that those factors are partially offset by acquisition activity that contributed to higher debt levels and...