S&P, Moody’s say their ratings outlook on Cedar Fair is stable

Cedar Fair gets stable ratings outlook

SANDUSKY, Ohio — Cedar Fair LP, one of the nation’s largest operators of amusement parks, got some modestly good news from two major credit rating agencies Thursday.

Moody’s Investors Service changed Cedar Fair’s rating outlook to stable from negative. Standard & Poor’s also said its rating outlook on Cedar Fair is stable.

Debt ratings can affect a company’s borrowing costs.

Moody’s said it was assigning a “Ba2″ rating to the company’s proposed $1.35 billion senior secured bank credit facilities and a “B2″ rating to its proposed $500 million senior unsecured notes. Those ratings are non-investment grade, or junk status.

“The rating actions reflect Moody’s view that the refinancing meaningfully improves the company’s liquidity position and provides the company flexibility to reduce debt and manage through a period of attendance-constraining high unemployment notwithstanding the increase in cash interest costs resulting from the refinancing,” Moody’s said.

S&P said it assigned a “BB-” rating to the $1.35 billion secured credit facilities. That, too, is junk status, but one notch higher than the “B+” corporate credit rating S&P has on the company.

S&P also rated the company’s $500 million senior notes due 2020 at “B-”, two notches lower than the “B+” corporate credit rating.

“The transaction extends debt maturities and resets financial covenants, which had been tight, with only a modest negative effect on credit measures,” S&P said.

Company shares fell 11 cents to $13.09 in afternoon trading. Cedar Fair is based in Sandusky, Ohio.