S&P rates Caesars loan B+

Standard & Poor's said it assigned preliminary B- corporate credit ratings to Caesars Entertainment Corp.'s subsidiaries Linq Borrower and Octavius Borrower.

The outlook is stable.

S&P also assigned the borrowers' proposed $400 million senior secured term loan due 2017 a preliminary B+ issue-level rating with a recovery rating of 1, indicating the expectation for very high (90%-100%) recovery in the event of a payment default.

Proceeds from the term loan, along with an equity contribution by Caesars Entertainment and expected cash flows from the projects, will be used to fund completion of the Octavius Tower at Caesars' Palace Las Vegas; to fund the design and development of a retail, dining and entertainment corridor located between the Imperial Palace Hotel and Casino and the Flamingo Las Vegas on the Las Vegas Strip, and for financing costs, including a 15-month interest reserve.

The ratings reflect the aggressive financial policy and weak credit profile of Caesars Entertainment, the agency said.

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