Moody’s drops Mashantucket Pequot, loans

Moody's Investors Service said it lowered Mashantucket Pequot Tribal Nation's corporate family rating to Caa3 from Caa1 and probability of default rating to Caa3-PD from Caa1-PD and placed them under review for further downgrade.

The agency also downgraded the tribe’s term loan A due 2018, term loan B due 2020, term loan C due 2016 and revolver due 2016 to B2 (LGD2) from B1 (LGD2) and placed them under review for further downgrade.

Moody’s said the downgrades and the possibility of further downgrades are based on its view that because of non-compliance with certain bank agreement financial covenants and a challenging market environment, there is a high degree of risk that Mashantucket Pequot will not be able to sustain its current capital structure and that some form of debt restructuring and impairment is likely.

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