Do Moody's, Fitch, or Standard & Poor's think Louisville's an upgrade?
Over the last few years, The Yum! Center's bond ratings have seriously deteriorated. In 2013, Moody's cut the Yum! Center's bond rating on it's entire $380 million issuance to junk. In the last year, S & P rated those bonds with their lowest investment-grade, provided that revenues remained stable. However, revenue did not remain stable. A couple months later, the Yum! Center announced that its Y-o-Y revenue for 2015 had decreased by 52% from $7+ million to $3+ million. So, the Yum! Center was holding onto that last "good" rating by the skin of their teeth.
If I'm a bank/insurance company/pension fund who isn't allowed to own non-investment grade debt, and consequently has to sell those bonds at a loss, I might be looking to lawyer-up, given the University of Louisville's unusually sweetheart profit/loss sharing arrangement with the Yum! Center is a major catalyst for those bond ratings dropping. All told, Louisville could lose a major source of income from the Yum! Center if those bonds are renegotiated.
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In response to this post by ren_hoek)
Posted: 09/26/2016 at 8:49PM