January 23rd, 2010
The Mashantucket Pequot Tribe in Connecticut operates the Foxwoods Casino and Resort. It has been attempting to restructure more than $2 billion worth of debt since last summer. It is reported that it has reached an agreement to continue these negotiations with its senior lenders.
According to a New York public relations firm, the Tribe and “a majority of its senior lenders” have reached “an agreement in principle” to extend a forbearance agreement through April 30 that was set to expire soon.
The Tribe’s casino has taken hits from the recession and growing competition.
In addition to the banks and Kien Huat, the Malaysian investment firm that originally financed Foxwoods, the Mashantuckets’ creditors include three levels of bondholders. In November, the tribe defaulted on $500 million worth of junior bonds.
The missed payment prompted Standard & Poor’s, the credit-rating agency, to lower its “issuer credit rating” on the tribe from CCC to D, its lowest possible rating.
The Tribe has stressed that its debt-restructuring efforts “are separate and distinct from operations at Foxwoods and will not have any impact on guests, employees, suppliers or business partners at Foxwoods or MGM Grand at Foxwoods.”