MUMBAI (Thomson Financial) - Standard & Poor's Ratings Services said it
raised its issue-level rating on Scientific Games Corp.'s existing subordinated
debt to 'BB-' from 'B+', citing a net increase in total debt and a decrease in
senior secured debt outstanding from that used in the previous recovery
analysis.
"As a result, a less significant deterioration in cash flow would be
required to produce a payment default, which also increases the emergence
enterprise value and improves the recovery prospects for the subordinated debt
holders," S&P said.
S&P also affirmed its 'BB' corporate credit rating on the company with a
stable outlook.
The ratings on Scientific Games reflect the highly competitive market
conditions in the lottery and pari-mutuel industries, the mature nature and
capital intensity of the online lottery industry, and the company's acquisitive
growth strategy.
The ratings agency said it views the additional liquidity as a positive
rating factor given the company's recent success in winning new contracts and
the associated capital spending needs as these contracts are ramped up.
At the same time, S&P assigned its 'BB-' issue-level rating with a recovery
rating of '5' to Scientific Games International Inc. unit's proposed $200
million senior subordinated notes due 2016.
S&P also affirmed its issue-level rating on Scientific Games International's
proposed $800 million credit facilities at 'BBB-'.
TFN.newsdesk@thomson.com
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