Moody's cuts Golden Nugget loans, notes

Moody's Investors Service said it downgraded Golden Nugget, LLC's expected senior secured revolver, senior secured term loan and senior secured notes ratings to B2 from B1. All other ratings remain unchanged, including its B3 corporate family rating, B3-PD probability of default rating and Caa2 senior unsecured notes due 2030.

“The downgrade of the senior secured bank credit facilities and senior secured notes ratings reflect the change in the capital structure with a significant increase in the amount of secured debt and a concurrent decline in amount of unsecured debt versus what was previously contemplated and announced. The downgrade acknowledges that following the change the senior secured debt will make up the large majority of the capital structure and that the smaller size of the unsecured notes provides less loss absorption to the secured debt at the point of any potential default,” Moody’s said in a press release.

Golden Nugget plans to use the debt to refinance its capital structure, fund a $250 million dividend and add cash to the balance sheet.

The outlook remains positive.

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