S&P raises ratings for Wynn Resorts

Friday, Nov. 19, 2004 | 10:52 a.m.

Standard & Poor's Ratings Services on Thursday raised its corporate and senior secured bank debt ratings for Wynn Resorts Ltd. and its subsidiary Wynn Las Vegas LLC to B+ from B based on higher performance expectations for Steve Wynn's upcoming Las Vegas resort, which is anticipated to open in April.

S&P also assigned a B+ rating to the company's proposed $1.1 billion senior secured credit facility for Wynn Las Vegas LLC and the proposed $1.1 billion first mortgage notes due 2014 to be issued by Wynn Las Vegas LLC and its Wynn Las Vegas Capital Corp. subsidiary.

Proceeds from the bank debt and bonds, in addition to $400 million to be contributed to Wynn Las Vegas LLC from the recently completed $453 million stock offering of Wynn Resorts, will be used to refinance existing debt at Wynn Las Vegas LLC, help fund the construction of the company's second tower expansion at the Wynn Las Vegas resort and for fees and expenses.

The outlook for Wynn Resorts and Wynn Las Vegas LLC has been revised to "stable" from "developing." Outstanding debt at Wynn Resorts, including the company's development in Macau is expected to peak at about $2.5 billion over the next few years, S&P said.

The upgrade reflects the expectation that operating performance at the Las Vegas resort "will be solid given its high-quality amenities, Steve Wynn's previous success in developing and operating properties in Las Vegas, the favorable operating momentum within the Las Vegas market and the expectation that this trend will continue in the immediate term," S&P Credit Analyst Michael Scerbo said.

Separately, Moody's Investors Service assigned a B2 rating to Wynn Las Vegas' $1.1 billion bank debt offering and $1.1 billion first mortgage notes due 2014.