Moody's Ratings downgraded Bally's Corporation's Corporate Family Rating to B3 from B2 and Probability of Default Rating to B3-PD from B2-PD on Friday.
The firm affirmed the Ba3 rated senior secured credit facilities and downgraded senior unsecured notes to Caa2 from Caa1. The speculative grade liquidity rating remains SGL-3 with a stable outlook.
The downgrade concludes a review initiated on August 2, 2024. It reflects governance concerns and increased debt from development plans and sale-leasebacks.
Moody's expects debt/EBITDA to remain elevated through 2026 as Bally's focuses on its Chicago casino. Additional projects in New York and Las Vegas will require significant capital.
The B3 CFR reflects high leverage and competitive pressures in online gaming. Positive factors include product diversification and growth in the Intralot business.
The stable outlook assumes revenue growth and deleveraging as new projects ramp up. Upgrades require debt/EBITDA below 6.0x; downgrades possible if leverage exceeds 8.0x.
