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Moody's confirms Boyd Gaming
Moody's Investors Service said it confirmed Boyd Gaming Corp.'s ratings and placed Coast Hotels and Casinos Inc.'s ratings on review for possible upgrade following the announcement that Boyd and Coast Casinos Inc., the parent of Coast Hotels and Casinos Inc., have entered into a definitive merger agreement.
Ratings confirmed at Boyd Gaming include its $400 million senior secured revolver due 2007 at Ba1; $98.8 million senior secured term loan facility due 2008 at Ba1; $200 million 9.25% senior unsecured notes due 2009 at Ba3; $250 million 8.75% senior subordinated notes due 2012 at B1; $300 million 7.75% senior subordinated notes due 2012 at B1.
Ratings at Coast Hotels and Casinos Inc. placed on review for upgrade include the senior implied rating at Ba3; the $325 million 9.5% senior subordinated notes due 2009 at B2; and the senior unsecured issuer rating at B1.
Boyd's outlook remains stable.
Moody's said the confirmation of Boyd's ratings considers that the acquisition will greatly expand the company's presence in the Las Vegas locals market, a growing market with a high barrier to entry and stable regulatory environment.
Key risks include the impact of higher taxes in Illinois and Indiana, heightened competition in Tunica and New Orleans, and the combined entity's aggressive capital spending plans.
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