Fitch revises MGM Mirage to stable

Fitch Ratings said it has affirmed the senior secured ratings of MGM Mirage at BB+ and has revised the outlook to stable from positive.

Fitch said the ratings reflect MGM Mirage's market leading assets, significant discretionary free cash flow, and visible growth prospects.

Offsetting factors include the company's limited geographic diversification and continued risk that cash flow will be directed toward share repurchases and/or other investment opportunities rather than further capital structure strengthening. About $5.25 billion is affected by this rating action.

The change in outlook incorporates Fitch's view that MGM Mirage's stated plan of achieving investment-grade status will extend over a much longer timeframe than previously anticipated, given cash flow deployment over the last four quarters.

Fitch noted that while the capacity has been there to meet the target leverage of below 4.0 times, management has undertaken aggressive share repurchases and heavy capital spending, which have precluded further credit improvement.

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