S&P: Holdings Gaming on positive watch

Standard & Poor's said it placed the CCC corporate credit rating on Holdings Gaming Borrower LP on CreditWatch with positive implications.

S&P said it believes the CreditWatch listing indicates a 50% chance of an upgrade on completion of the review.

The positive watch reflects a view that given improved operating performance in recent quarters - largely due to the July 2010 addition of table games in Pennsylvania - cash flow will be sufficient to meet fixed charges in the intermediate term, the agency said.

Operating improvement better positions the company to potentially pursue a refinancing that would alleviate the company's current interest burden, S&P said.

Still, given the substantial level of noncash interest that will accrue, it remains unclear whether the company's capital structure is sustainable over the long term, the agency said.

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