S&P rates Golden Nugget B, loans BB-, B

Standard & Poor's said it assigned a B corporate credit rating to Golden Nugget LLC, along with a BB- rating to its $10 million revolving credit facility due Nov. 24, 2015 and its $36.5 million term loan due May 24, 2016.

A recovery rating of 1 was assigned to this debt, indicating 90% to 100% expected recovery in a default. The revolving credit facility has first-out priority in application of proceeds from collateral, S&P said.

The agency also said it assigned a B rating to the Golden Nugget's $20 million delayed draw term loan due Nov. 24, 2016 with a recovery rating of 3, indicating 50% to 70% expected recovery in a default.

The outlook is stable.

The proceeds will be used, along with equity proceeds from Tilman Fertitta and Landry's Restaurants Inc., to acquire the Trump Marina Casino and Hotel in Atlantic City and to finance renovations at the property.

The company completed the acquisition in May 2011.

The ratings reflect Golden Nugget's reliance on a single property for cash flow generation, the highly competitive dynamics in the region and an expectation that the U.S. economy will only gradually improve over the next several quarters, S&P said.

The investments in the property will generate a sufficient return to meet the estimated fixed charges, but that only partially offsets the negative rating factors, the agency said.

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