Moody's may cut Prime Hospitality

Moody's Investors Services said it placed the ratings of Prime Hospitality Corp. on review for possible downgrade, including the senior implied rated of Ba3, the senior unsecured issuer rating of B1, and the $200 million 8.375% senior subordinated global notes due May 1, 2012, rated B2.

Moody's said the rating action was prompted by Prime's recent announcement that it has signed a definitive agreement to be acquired by affiliates of the Blackstone Group for an estimated purchase value of about $790 million, including debt. Prime also announced it will be commencing a tender for the 8.375% senior subordinated global notes, which also benefit from a change-of-control provision in the bond indenture.

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