Moody's rates ROC Finance loans Ba3, notes Caa1

Moody's Investors Service said it assigned a B3 corporate family and probability-of-default rating to ROC Finance LLC as well as a Ba3 rating (LGD2, 23%) to the company's $275 million first-lien bank credit facilities and a Caa1 (LGD5, 78%) to its proposed $380 million second lien notes due 2018.

The outlook is stable.

Proceeds will be used to finance construction of two full scale casinos located in Cleveland and Cincinnati, Ohio.

ROC Finance LLC's B3 corporate family rating reflects the company's construction and ramp-up risk in a new gaming jurisdiction, reliance on completion of the Cleveland casino to help fund development of the Cincinnati casino, and legislative and regulatory risks in Ohio, the agency said.

Ratings reflect the view that the operating experience of Casesars, its established database of potential gaming customers, and the market profile of both Cleveland and Cincinnati will support the ramp up of each casino, the agency noted.

The debt-to-EBITDA ratio by year-end 2013 when both casinos are open are expected to range between 5 times to 5.5 times.

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