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S&P rates Little Traverse Bay notes B
Standard & Poor's said it assigned a B rating to Little Traverse Bay Band of Odawa Indians' $120 million senior notes due 2014 and affirmed the Tribe's B issuer credit rating.
The outlook has been changed to stable from negative, reflecting lower expected leverage stemming from a sizable reduction in the Tribe's planned gaming expansion project, the agency said. The revised project size was reduced by about $60 million to about $140 million following the Tribe's decision to build a new gaming facility and amenities without an attached hotel, adding flexibility in the Tribe's financial profile in the case of a moderate opening for the new facility.
S&P said the ratings on the Tribe reflect a narrow gaming operation, as all cash flow stems from a single casino; a competitive marketplace that is facing additional intermediate-term gaming supply and challenges managing a larger gaming facility.
These are only partially tempered by the escrowing of the first three interest payments on the notes, totaling $17 million, and stable cash flow from the existing gaming facility, the agency said.
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