Fitch upgrades outlook for MGM Resorts International’s debt

Fitch Ratings Service upgraded its view of the debt covering MGM Resorts International and the company's hotel-casino in Macau.

The advisory service also affirmed its positive view of CityCenter, half-owned and operated by MGM Resorts.

In statement Thursday, Fitch gaming analyst Michael Paladino said the positive views of MGM Resorts were based on the service's "continued positive outlook on Las Vegas Strip fundamentals over the next couple of years, despite some recent demand weakness."

MGM Resorts has $13.4 billion in long-term debt and operates 10 hotel-casinos on the Strip, including Bellagio, MGM Grand, Mandalay Bay and The Mirage.

Fitch also remained upbeat about CityCenter, which includes the centerpiece Aria.

Paladino said CityCenter, which includes nongaming hotels, high-rise residential and the Crystal's retail, dining and entertainment district, benefits from its location at the center of the Strip and "the property's meaningful exposure to high-end international play, which has been a major driving factor for the Las Vegas Strip recovery over the past two years."

MGM Resorts became majority owner of the 600-room MGM Grand Macau more than year ago when the company launched an initial public offering on the Hong Kong Stock Exchange.

Paladino said the increased ownership stake could lead to an increased credit agreement for the Macau property.

Paladino said MGM Resorts' "favorable execution of capital market transactions" this year has improved the company's overall debt maturities outlook damaging the interest expenses.

He said MGM Resorts has the opportunity to reduce interest costs through refinancing high-interest secured notes in 2013 and 2014.

Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871. Follow @howardstutz on Twitter.