Casino Operator Given Junk Rating; Winn-Dixie Needs Amendment

  • 21 Sep 2003
Email a colleague
Request a PDF

Standard & Poor's pushed Park Place Entertainment Corp. off the investment-grade cliff, downgrading the company's corporate credit rating from BBB- to BB+. S&P cites that the casino operator's plans for a $376 million expansion project at its Caesars Las Vegas property come at a time when credit measures have not improved to levels more consistent with the previous ratings. Park Place's EBITDA is lower than expected for the first six months of 2003, S&P explains, noting that multiples were expected to be much closer to four times by the end of this year, compared to 4.5 times at the end of last year. Park Place's debt as of last June was approximately $4.7 billion.

"Our company is committed to reducing debt. Since January 2002, we have paid down debt by $570 million. But at the same time, we have a commitment to our shareholders to grow our top line and we will continue to look for opportunities to do that," said a Park Place spokesman. "[The downgrade] reflects S&P's concerns with debt levels in the entire casino resort industry," he further noted.

* Winn Dixie Stores' corporate credit rating was downgraded from BB+ to BB by S&P. The downgrade was based on lower expectations for earnings and the potential for violation of bank covenants for the quarter ending this month, S&P says. "Based on the company's current projections of operating results for the first quarter of fiscal 2004, it will not be in compliance with certain bank covenants," S&P explains, adding that the Jacksonville, Fla.-based food and drug store, warehouse outlet, gas station and liquor store conglomerate is working with banks and expects to obtain an amendment before the quarter ends. S&P states that it believes this is achievable. Wachovia Securities and Merrill Lynch lead an existing credit for the company. Richard McCook, senior v.p. and cfo of Winn-Dixie, did not return calls.


Other Ratings Actions*
Gray TelevisionBa2Upgraded from Ba3Moody's
O'Sullivan IndustriesCaa1Downgraded from B2Moody's
Titan Corp.Ba3On Review for UpgradeMoody's
* Thurs, Sept. 11 through Wed, Sept. 17
  • 21 Sep 2003

GlobalCapital European securitization league table

Rank Lead Manager/Arranger Total Volume $m No. of Deals Share % by Volume
1 BNP Paribas 14,443 29 18.07
2 Bank of America Merrill Lynch (BAML) 8,264 27 10.34
3 Lloyds Bank 7,329 24 9.17
4 Citi 6,748 19 8.44
5 JP Morgan 5,220 8 6.53

Bookrunners of Global Structured Finance

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 Citi 117,261.12 337 11.07%
2 Bank of America Merrill Lynch 94,721.79 272 8.94%
3 JPMorgan 92,612.23 269 8.74%
4 Wells Fargo Securities 82,597.19 239 7.80%
5 Credit Suisse 69,442.99 183 6.55%