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S&P Global Ratings raised its issue-level rating on Mashantucket (Western) Pequot Tribe’s term loan to ‘CCC-’ from ‘D’, reflecting its view that there is a high probability of some form of restructuring within the next six months. The issuer credit rating on the entity remains ‘SD’.

S&P raised its issue-level rating on the Mashantucket (Western) Pequot Tribe’s term loan B to ‘CCC-’ from ‘D’. The ‘CCC-’ issue-level rating reflects our view that some form of restructuring appears to be inevitable within six months, absent unanticipated significantly favorable changes in the Tribe’s circumstances.

“We view the Tribe’s liquidity as weak because there is a material deficit within the next six months given the term loan now matures Dec. 31, 2020,” S&P said.

“Furthermore, the Tribe’s capital structure is highly leveraged and its operating performance has been weak in recent periods as a result of increased competition in its market. This was further exacerbated by the casino’s closure from mid-March to June as a result of the COVID-19 pandemic,” the rating agency said.

S&P’s issuer credit rating on the Tribe remains ‘SD’ (selective default) because the Tribe has been unable to make full and timely debt service payments to its junior debtholders following the receipt of a blocking notice from its senior lenders.

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