S&P lifts Isle of Capri notes

Standard & Poor's said it raised its issue-level rating on Isle of Capri Casino Inc.'s $300 million 7¾% senior notes due 2019 to B+ from B.

The rating was removed from CreditWatch, where it had been with positive implications since Feb. 28.

The recovery rating on this debt was revised to 2 (expectation of 70% to 90% recovery) from 4 (30% to 50% recovery).

The company closed on $350 million of 5 7/8% senior notes due 2021 and amended and restated its credit facility, which now consists of only a $300 million revolving credit facility (same revolver size as previous agreement).

The company used proceeds to repay in full its previously outstanding term loan totaling about $490 million. This results in a lower amount of secured debt outstanding at default under S&P's simulated default scenario and improves the recovery prospects for the senior notes.

The agency assigned a recovery rating of 2 to the proposed 5 7/8% senior notes when it rated them, which assumed the term loan repayment.

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