Moody's ups MGM Resorts

Moody's Investors Service said it upgraded MGM Resorts International's corporate family rating to B3 from Caa1 and its probability of default rating to Caa1 from Caa2. MGM's senior secured ratings were raised to Ba3 (LGD1, 5%) from B1 (LGD 1, 4%) and senior unsecured and senior subordinated ratings were affirmed at Caa1 (LGD 3, 49%) and Caa3 (LGD 5, 87%), respectively.

MGM's SGL-3 speculative-grade liquidity rating remains unchanged.

The outlook is stable.

The upgrade reflects signs of modest improvement in demand trends in Las Vegas, debt repayment during 2010 from the proceeds of equity issuances and completion of a new multi-year financing package for CityCenter, Moody's said.

The ratings reflect significant refinancing risk over the next few years, very high leverage and weak interest coverage, the agency said.

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