Moody's rates Speedway notes Ba2

Moody's Investor Service said it assigned a Ba2 rating to Speedway Mortorsports Inc.'s $100 million of senior subordinated notes due 2013 and confirmed the company's Ba1 senior implied rating, its Ba1 senior secured (stock) bank debt rating and its Ba2 senior subordinated notes following the company's announced acquisition of North Carolina Speedway for about $100 million in cash.

The outlook is stable.

The $100 million new note issue, along with cash on hand, will be used to finance the company's acquisition of North Carolina Speedway.

Although this transaction adds another $100 million worth of subordinated debt onto Speedway Motorsports' balance sheet, Moody's ratings incorporated the likelihood of debt-funded acquisitions.

Speedway Motorsports' total debt-to-EBITDA improved to just under 2x for the 12-month period ended March 31 from almost 3x for the year ended December 2000. Moody's expects the additional $100 million of debt to raise the leverage to around 2.5x total debt-to-EBITDA, which reduces financial flexibility moderately for the near-term.

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