Moody's cuts 155 East Tropicana

Moody's Investors Service said it downgraded 155 East Tropicana LLC's corporate family and probability-of-default ratings to Ca from Caa2 and its $130 million 8¾% senior secured notes due 2012 to Ca (LGD4, 56%) from Caa3 (LGD4, 57%). The SGL-4 speculative-grade liquidity rating was affirmed.

The outlook is negative.

In Moody's opinion, the deterioration of the economic conditions in Las Vegas and the company's weakening liquidity profile make a default likely in the next 12 months. The agency said this default could occur through the materialization of a distressed exchange offer, a missed interest payment or bankruptcy filing.

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