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S&P boosts Dave & Buster's loan
Standard & Poor's said it raised its rating on the senior secured credit facility of Dave & Buster's Inc. to B from B-, one notch higher than the corporate credit rating on the company.
The recovery rating of the facility was raised to 1 from 3, indicating the expectation for full recovery of principal in the event of default, the agency added.
The upgrade reflects the company's ability to reduce the balance on its $100 million term loan to $79.4 million and thereby affording holders better recovery prospects, the agency noted.
At the same time, S&P said it affirmed its other ratings on Dave & Buster's, including the B- corporate credit rating and the CCC+ senior unsecured rating.
The outlook is negative.
The ratings on Dave & Buster's reflect the company's small size in the highly competitive restaurant and out-of-home entertainment industries, vulnerability to cost increases and changes in consumer spending habits and its highly leveraged capital structure that limits cash flow protection, S&P noted.
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