Moody's may drop Riviera Holdings

Moody's Investors Service said it placed the B2 credit ratings of Riviera Holdings Corp. on review for possible downgrade.

The agency said this ratings action follows the Riviera's announcement that it has entered into a definitive merger agreement to be acquired by Riv Acquisition Holdings Inc. for $17.00 per share, excluding the shares of Riviera's Chairman and CEO, Mr. William L. Westerman, which will be sold for $15.00 per share.

This rating action reflects future capital structure uncertainty, the possibility that, following the acquisition, Riviera's credit metrics could fall below the B2 rating band and the possibility that the existing notes could remain outstanding following the acquisition, the agency added.

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