Luxury hotel and casino operator Resorts World Las Vegas (RWLV) was downgraded to BBB- from BBB by Fitch following the rating agency’s re-assessment of its linkage with parent Genting Bhd. RWLV’s senior secured and unsecured debt were also cut to BBB-, with Fitch assigning a negative outlook on the issuer. Fitch’s re-assessment is based on the updated ‘Parent and Subsidiary Linkage Rating Criteria’ published on December 1, 2021. Fitch added that Genting has:
  • “Medium” operating incentive to support RWLV in times of distress, given the limited interdependence in the operations of the parent and RWLV
  • “Low” legal incentive given that neither does Genting guarantee RWLV’s debt nor does Genting’s debt have cross-default clauses linked to RWLV’s debt
  • “High” strategic incentive given Fitch’s assessment of “High” financial contribution, “High” competitive advantage and “Medium” growth potential of RWLV
The negative outlook is on the back of uncertainty over the pandemic and the government’s decision over opening up casino and tourism operations.
RWLV’s 4.625% 2031s have been trending lower since the start of the year, down ~3.6 points to 95.73 yielding 5.22%.

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