S&P: Landry's on watch

Standard & Poor's said it placed all its ratings, including the B corporate credit rating, on Landry's Restaurants Inc. and its unrestricted subsidiary, Golden Nugget Inc. on CreditWatch with negative implications.

The agency said that this action follows the announcement that the company's CEO, Tilman Fertitta, has made a proposal to purchase all of Landry's outstanding common stock at $23.50 per share, a 41% premium over the closing price of $16.67 on Jan. 25.

According to S&P, the total value of the deal is $1.3 billion and roughly $380 million would be necessary to purchase the outstanding equity.

If accepted, the offer could increase financial risk at the company given that part of the transaction would likely be financed with additional debt and S&P said it will monitor the buyout proposal and take the appropriate rating actions once more information about the transaction is available.

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