Moody’s reviews Yonkers Racing, rates loan B1

Moody's Investors Service said it placed Yonkers Racing Corp.’s B2 corporate family rating and B2-PD probability of default rating on review for upgrade in response to the company's announcement that it intends to refinance its first-lien and second-lien term loans with a new $260 million first-lien term loan B due 2024.

The agency assigned a B1 rating to the proposed first-lien term loan B.

Proceeds from the proposed term loan along with about $16 million of balance sheet cash will be used to repay Yonkers' existing $210 million first-lien term loan due 2019 ($245 million original issue amount) and $60 million second-lien term loan due 2020 ($70 million original issue amount). The company also plans to replace its existing $10 million working capital line with a new $10 million working capital facility that will be undrawn at closing.

"The review for upgrade considers that the proposed refinancing will materially extend Yonkers' debt maturity profile about 5 years as well as lower its overall cost of debt, partly through the elimination of $60 million of relatively high cost second lien term loan debt which represents about 20% of the company's existing debt capital," Moody’s senior vice president Keith Foley said in in a news release.

"These considerations coupled with Yonkers' consistent improvement in both revenue and earnings, little in the way growth capital expenditure requirements, and gradual debt reduction during the past few years, provide the company with a credit profile consistent with a one-notch higher rating."

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.