Says Connecticut-based casino giant could find it difficult to refinance significant debt maturities
Moody’s Investors Service has moved Mohegan Tribal Gaming Authority’s debt into highly speculative territory, saying the Connecticut-based casino giant could find it difficult to refinance significant debt maturities without some impairment to bondholders.
Mohegan’s rating was lowered two notches to Caa2, according to a report on Dow Jones Newswire, reflecting the relatively short time the authority has to address what Moody’s believes to be a “significant capital-structure issue”.
The downgrade was also attributed to limited near-term growth prospects for Mohegan Sun, the tribe’s flagship resort in southeastern Connecticut, as a result of what is expected to be continued weak consumer gaming demand in the Northeast and the strong possibility of competition from Massachusetts.
Last week, Mohegan reported a fiscal fourth-quarter loss on write-downs, although gambling revenue grew. Following the results, Standard & Poor’s Ratings Services lowered its rating on the company to highly speculative, citing similar concerns to Moody’s.
The authority has hired Blackstone Group to help deal with its capital-structure issues.
Mohegan's debt a real concern for Moody's
December 1, 2010