Moody's assigns Caesars Caa1

Moody's Investors Service said it assigned a Caa1 rating to Caesars Entertainment, Inc.'s planned $1 billion of senior unsecured notes.

The company's B2 corporate family rating, B2-PD probability of default rating, existing B1 rated senior secured notes due 2025, and existing Caa1 rated senior unsecured notes due 2027 are unchanged. The company's SGL-1 Speculative Grade Liquidity rating is unchanged, and the outlook remains stable.

Additionally, wholly owned subsidiary Caesars Resort Collection, LLC's B1 rated senior secured revolver and term loans, B1 rated senior secured notes due 2025, and Caa1 rated senior unsecured notes due 2025 are unchanged. CRC's outlook remains stable.

Caesars will use the proceeds along with cash on hand to refinance CRC's $1.7 billion of 5¼% senior unsecured notes. Moody's said it plans to withdraw the rating on CRC's notes once the transaction closes and the notes are repaid.

“The transaction is credit positive because it will extend Caesars' debt maturity profile and reduce debt and leverage. Moody's expects the earnings gains and debt reduction funded from positive free cash flow and asset sale proceeds will reduce leverage from the peaks hit during the coronavirus and improve the company's financial flexibility, aided by very good liquidity, to manage amid the lingering effects of the pandemic,” the agency said in a press release.

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