S&P ups American Casino, rates loans BB, B-

Standard & Poor's said it raised its corporate credit rating on American Casino & Entertainment Properties LLC to B+ from B and removed the rating from CreditWatch, where it was placed with positive implications on June 10.

In addition, the agency assigned the company's $230 million senior secured credit facilities its issue-level rating of BB with a recovery rating of 1, indicating an expectation for very high (90% to 100%) recovery for lenders in the event of a payment default.

The credit facilities consist of a $15 million senior secured revolving credit facility due 2018 and a $215 million senior secured term loan due 2020.

At the same time, S&P assigned American Casino's $120 million second-lien term loan its B- issue-level rating with a recovery rating of 6, indicating an expectation for negligible (0% to 10%) recovery for lenders in the event of a default.

American Casino used proceeds from the transactions to repay its outstanding $338 million 11% senior secured notes. As a result, S&P withdrew its issue-level and recovery ratings on the senior secured notes.

The upgrade reflects the agency's reassessment of the company's financial risk profile as "aggressive" following its refinancing transaction earlier this year.

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