Bally’s Corporation faces downgrade from Fitch Ratings

Fitch Ratings downgraded Bally’s Corporation from ‘B’ to ‘B-’, citing its heavy debt load and risks tied to its $1.7 billion Chicago casino project. Currently, Bally’s has a high debt burden, with leverage expected to rise due to new loans and lease obligations. While the company secured $940 million in private financing, it’s still trying 

Fitch Ratings downgraded Bally’s Corporation from ‘B’ to ‘B-’, citing its heavy debt load and risks tied to its $1.7 billion Chicago casino project.

Currently, Bally’s has a high debt burden, with leverage expected to rise due to new loans and lease obligations. While the company secured $940 million in private financing, it’s still trying to raise $250 million through an IPO restricted to minority and women investors. To stay afloat, Bally’s has already started selling $195 million in private shares.

The company has access to $620 million in credit and no major debt payments due until 2028. However, Fitch warns that liquidity is tightening due to ongoing costs.

Additionally, Bally’s temporary casino at Medinah Temple brought in just $8.8 million in February, marking it the worst month for the year.

Bally’s CEO Robeson Reeves said:

“The temporary Chicago casino returns remain below our expectations, though we are hearing from customers that they are increasingly excited by what is starting to happen a few blocks northwest at the permanent site.”

Meanwhile, Bally’s is seeking a $300 million property tax break, but the proposal is still in the City Council. It’s also facing lawsuits over its minority investment program, with claims of discrimination against white male investors.

On the upside, Bally’s could get a credit boost if it secures full funding. A potential $735 million sale-leaseback deal for Twin River Casino could also provide some financial relief.