Moody's cuts Maverick Gaming

Moody's Investors Service said it downgraded Maverick Gaming LLC's corporate family rating to Caa2 from B3 and probability of default rating to Caa2-PD from B3-PD and appended the PDR with the /LD, limited default, designation. The agency lowered Maverick’s senior secured term loan to Caa2 from B3, and the company's $55 million super-priority first-out revolving credit facility to B1 from Ba3.

“The downgrade of the company's CFR to Caa2 and negative outlook reflects Maverick's elevated leverage levels and weakened liquidity position. The company's operating results have been weaker than Moody's original expectations, with softer-than-expected results in Washington card rooms and the Colorado market. While Moody's believes the company has rightsized the business through various cost-cutting initiatives, leverage will be sustained at higher levels into 2024,” the agency said in a press release.

The LD reflects Maverick’s repurchases of its 2023 term loan as a discount, which the agency said it considers a default under its definitions. Maverick repurchased $45 million of its $310 million term loan due 2026. Moody's will remove the /LD designation from the PDR in three business days.

The outlook is negative.

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