Moody's rates Majestic Star notes B2, B3, Caa2

Moody's Investors Service said it confirmed Majestic Star Casino, LLC and its co-issuer Majestic Star Casino Capital Corp.'s B2 corporate family rating and B2 rating on its outstanding $260 million of 9½% senior secured notes due 2010.

Moody's said it also assigned a B2 rating to Majestic Opco's proposed $30 million add-on to its existing 9½% senior secured notes, a B3 rating to its proposed $200 million 10% senior guaranteed unsecured notes due 2011 and placed its $80 million senior secured bank loan on review for possible upgrade.

The outlook is stable.

At the same time, Moody's added it assigned a Caa2 rating to Majestic Holdco LLC and its co-issuer Majestic Star Holdco, Inc.'s $55 million of 12% senior discount notes due 2011 while a B2 corporate family rating and stable ratings outlook were also assigned to Majestic Holdco.

The ratings confirmation of Majestic's existing corporate family and senior secured notes considers that, despite an increase in leverage resulting from the planned debt-financed acquisition, Majestic's competitive position and growth opportunity in the Chicagoland gaming market will improve and the company will be able to take advantage of significant operating synergies given that Majestic's Indiana riverboat is adjacent to Trump Indiana, the agency said.

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