Moody’s ups Centaur, rates loans Ba3

Moody's Investors Service said it upgraded Centaur Acquisition, LLC's corporate family rating to B2 from B3, probability of default rating to B2-PD from B3-PD and its $175 million senior secured second-lien term loan due 2020 to B3 from Caa1.

The agency also assigned Ba3 ratings to the company's new first-lien senior secured credit facilities, consisting of a $25 million revolving credit facility due 2019 and $400 million term loan due 2019.

The outlook is stable.

Moody’s said the upgrade reflects Centaur's improved operating margins due to cost efficiencies and improved leverage as the company has reduced its debt by $65 million over the past year. Centaur's debt/EBITDA has improved to about 6 times for the LTM period ended March 31, 2014 from about 7 times.

The upgrade also considers the benefits of the refinancing, which will result in annual interest savings of about $8 million and the favorable performance of the company's two racinos (Indiana Grand and Hoosier Park) relative to the other casinos in Indiana, the agency said.

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