Moody's affirms American Real Estate

Moody's Investors Service said it affirmed the ratings (Ba2 senior unsecured) of American Real Estate Partners LP with a stable outlook.

AREP is a master limited partnership that has publicly traded depositary units. AREP's general partner is American Property Investors Inc., which is a wholly owned subsidiary of Becton Corp., which is owned by Carl Icahn.

Moody's said the rating affirmation with a stable outlook is prompted by the announcement that AREP has agreed to acquire additional oil and gas, and gaming and entertainment, assets in transactions with affiliates of Icahn. The proposed transactions include the acquisition of the interest in NEG Holding LLC other than that already owned by National Energy Group Inc. (which is itself 50.01% owned by AREP), 100% of the equity of each of TransTexas Gas Corp. and Panaco Inc., as well as an increased stake in GB Holdings (indirect owner of The Sands Hotel and Casino in Atlantic City, N.J.).

According to Moody's, the proposed acquisitions are consistent with AREP's business strategy, which uses a contrarian investment approach of acquiring distressed, or undervalued, "turnaround" assets.

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