Moody’s might upgrade Gala Electric

Moody's Investors Service said it placed on review for possible upgrade the ratings of Gala Electric Casinos plc.

This includes the B1 corporate family rating, B1-PD probability of default rating, the Ba3 rating of the £350 million senior secured notes due 2018 (£88 million outstanding) issued by Gala Group Finance plc and the B3 rating of the £275 million senior notes due 2019 (£175 million outstanding) issued by Gala Electric.

The review was prompted by the July 26 announcement that the Competition Markets Authority (CMA) completed its analysis on the merger of Gala's betting businesses into Ladbrokes plc (Ba2, stable). The CMA's conclusion, which envisages that the combined entity will dispose at least 350-400 betting shops in order to address any competition concerns, is in line with both companies' expectations and therefore the merger is anticipated to go ahead.

The action reflects that, given Ladbrokes' Ba2 ratings, Gala's corporate family rating and instrument ratings will likely be rated higher than they are now once the merger is completed.

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