S&P assigns Gaming & Leisure notes BBB-

S&P assigned its BBB- issue-level rating and 2 recovery rating to Gaming & Leisure Properties Inc.’s proposed senior unsecured notes.

“We expect the company to issue at least $300 million of these notes. The 2 recovery rating indicates our expectation for substantial recovery (70%-90%; rounded estimate: 80%) for noteholders in the event of a payment default,” S&P said in a press release.

Subsidiaries GLP Capital LP and GLP Financing II Inc. will co-issue the notes.

Gaming & Leisure plans to amend its credit agreement. The company has non-binding commitments to extend the maturity date of $208 million of its outstanding $449 million term loan A to May 21, 2023, from April 28, 2021, and increase the principal of the term loan by $200 million by issuing incremental term loans, S&P said.

The company plans to use the proceeds and incremental term loans to repay borrowings under its revolving credit facility and for working capital and general corporate purposes.

“The proposed financing transaction is largely debt for debt and does not affect our forecast for GLPI’s adjusted leverage, which we expect to remain in the high-5x area in 2020. Therefore, all of our ratings on the company, including our BB+ issuer credit rating, remain unchanged,” S&P said.

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