Weekly Downgrade Wrap-Up
As usual, we have a week’s worth of ratings agency actions on the debt of LBO-backed companies from Moody’s Investors Services and Standard & Poor’s. This week, we've got a rating on the new Harrah's debt (higher than expected), and downgrades on companies owned by Apollo, Apax, Canaan Partners, Centerbridge Capital Partners, Silver Hawk, Silver Lake, Kohlberg & Co., Madison Dearborn Partners LLC and Providence Equity Partners. Company: Harrah's Entertainment Inc. Sponsor: TPG and Apollo Management Downgrade: S&P placed the company’s 'CCC' corporate credit rating on CreditWatch with positive implications. S&P also assigned the proposed $1.0 billion senior secured notes offering an issue-level rating of 'B' (two notches higher than the expected 'CCC+' post-transaction corporate credit rating on Harrah's).” Highlights: "We view the bank amendment as being a positive step since we were previously concerned that, given our expectation for operating performance, HOC may not have been able to remain in compliance with its senior secured leverage ratio covenant in the coming quarters.”
