Fitch cuts MGM Mirage

Fitch Ratings said it has taken the following rating actions for MGM Mirage following the lawsuit filed against MGM by CityCenter JV partner Dubai World, and the two-month covenant waiver obtained from its bank lenders last week:

• issuer default rating downgraded to C from CCC; senior secured notes downgraded to CCC/RR2 from B/RR2; senior unsecured credit facility downgraded to CC/RR3 from B-/RR3; senior unsecured notes downgraded to CC/RR3 from B-/RR3; and senior subordinated notes affirmed at C/RR6.

Fitch noted that the downgrade affects MGM's $7 billion credit facility, $6.2 billion of outstanding senior unsecured debt, $848 million of outstanding senior subordinated debt, and $750 million of senior secured notes.

Due to the high level of credit risk inherent in a C issuer default rating, Fitch said it is not providing an outlook.

Fitch added that it downgraded MGM's issuer default rating to CCC on Feb. 27, after the company borrowed the remaining $842 million under the $4.5 billion senior revolving portion of its $7 billion credit facility.

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