S&P lowers Green Valley

Standard & Poor's said it lowered its corporate credit rating on Green Valley Ranch Gaming LLC to CCC from B- and lowered the issue-level ratings on the company's debt by two notches.

The outlook is negative.

The agency said the downgrade follows Station Casinos Inc.'s recent fourth-quarter 2008 earnings release, in which it disclosed that Green Valley Ranch (in which Station owns a 50% interest) generated EBITDA before management fees of $15.8 million in the quarter, 45% below the prior comparable period. This level of decline is substantially higher than S&P had incorporated into the previous B- rating.

S&P now believes that Green Valley Ranch's ability to generate sufficient cash flow to service its current capital structure is in doubt, and the agency is concerned that the level of support needed from the owners may be more meaningful than they are willing to provide.

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