Moody's rates MGM Mirage notes Caa1

Moody's Investors Service said it assigned a Caa1 (LGD 3, 43%) rating to MGM Mirage's proposed $750 million senior convertible notes due 2015.

Moody's also said it affirmed the company's Caa2 probability of default rating and Caa1 corporate family rating, along with its senior secured ratings at B1, senior unsecured ratings at Caa1, senior subordinate ratings at Caa3 and speculative grade liquidity rating at SGL-3.

The outlook is stable.

The proceeds will be used to repay outstanding debt under its senior bank credit facilities.

As a result of the proposed debt issuance, MGM's liquidity profile has improved by creating sufficient revolver capacity to meets its 2010 and 2011 debt maturities, Moody's said.

The ratings also consider the company's high leverage, difficult operating environment in Las Vegas, potentially large guaranty funding for its CityCenter project, need to close CityCenter condominium sales to offset guaranty funding and need to obtain additional liquidity by 2011, the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.