Moody's downgrades Greektown

Moody's Investors Service said it lowered Greektown Holdings, LLC's probability-of-default rating to D from Caa1, corporate family rating to Ca from Caa1, $125 million revolver due 2010 and $190 million term loan due 2012 to Caa2 (LGD2, 30%) from B1 (LGD2, 20%) and $185 million 10¾% senior notes due 2013 to C (LGD5, 86%) from Caa2 (LGD5, 75%).

The downgrade follows the company's announcement that it voluntarily filed for Chapter 11 bankruptcy.

The agency said that in addition to acknowledging the bankruptcy filing, the downgrade completes the review process that began on April 7 in response to heightened concerns regarding the company's ability to obtain the funds necessary to complete its permanent casino expansion and cure existing and potential financial covenant violations related to its loan agreement and its development agreement with the Michigan Gaming Control Board.

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