S&P upgrades Studio City

Standard & Poor's said it raised the long-term corporate credit rating on Studio City Co. Ltd. to BB- from B+.

The outlook is stable.

The agency also said it raised the long-term issue rating to B from B- on the senior notes that Studio City Finance Ltd.

S&P also said it raised the Greater China regional scale ratings on Studio City to cnBB+ from cnBB and on the notes to cnBB- from cnB+.

Studio City Finance is the indirect parent of Studio City and its existing and future restricted subsidiaries guarantee the notes, the agency said.

The upgrades reflect a belief the Melco Crown Entertainment Ltd. has a strong willingness and ability to financially support Studio City in a stress scenario, said Joe Poon, an S&P analyst.

Studio City is now considered a strategically important subsidiary of the Melco group under the agency's group rating methodology, Poon said in a press release.

Studio City is an important part of Melco's expansion in the gaming sector and has high integration with the group, Poon added.

The ratings also consider the company's high leverage and significant construction and execution risks associated with its integrated gaming resort development in Cotai, Macau, the agency added.

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