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Moody's downgrades American Casino note to B3
Moody's Investors Service said it assigned B2 corporate family and probability-of-default ratings to American Casino & Entertainment Properties LLC and downgraded the $215 million 7.85% senior secured second-lien notes due 2012 to B3 (LGD4, 61%) from Ba3 (LGD 2, 29%).
The outlook remains stable.
The downgrade follows the announcement that American Entertainment Properties Corp. has withdrawn its planned offering of $250 million senior floating-rates notes. The agency said the downgrade reflects the absence of the structurally subordinated holding company notes that were not issued and the application of Moody's loss-given-default methodology.
The stable outlook encompasses the risk that the parent company may decide to recapitalize American Casino at some future date when market conditions are more favorable, the favorable demand outlook for gaming in Nevada, the absence of near term maturities and adequate liquidity, Moody's added.
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