Moody’s trims Ontario Gaming

Moody's Investors Service said it downgraded Ontario Gaming GTA LP's (One Toronto Gaming) corporate family rating to B3 from B2 and probability of default rating to B3-PD from B2-PD. At the same time, the agency lowered to B3 from B2 OTG's instrument ratings comprising of $800 million (pro forma $1.25 billion) backed senior secured first-lien term loan B due 2030, $400 million backed senior secured notes due 2030 and its $200 million backed senior secured first lien revolving credit facility expiring 2028.

The downgrades follow OTG's planned $450 million term loan B add-on, to be used to fund a C$600 million dividend to its indirect shareholders, affiliates of Great Canadian Gaming Corp. and Brookfield Business Partners LP, Moody’s said.

"The debt-funded distribution reflects OTG's aggressive financial policies that weaken its credit metrics at a time when the company has yet to demonstrate a track record of performance at its newly built Toronto Casino Resort," said Dion Bate, a Moody's vice president, in a press release.

The outlook is stable.

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