Ryman Hospitality Properties executives are marketing a $400 million loan they will use to pay off their revolving credit line balance and keep handy for when more than $230 million of convertible debt matures this fall.
Analysts at Moody's Investors Service have given the new loan a Ba3 rating in line with other company debts. They acknowledge that the term loan plan will increase Ryman's leverage — as of March 31, the company had $1.15 billion of debts and capital lease obligations — but say the company's operations are improving, especially now that the integration troubles with Marriott International appear to have passed.
"Pro forma metrics are still considered reasonable for its rating category," the analysts wrote. "Ryman is also enhancing its liquidity by addressing a large upcoming maturity and it will have modest remaining funding needs until its next debt maturities in 2017. Furthermore, Moody's expects the REIT's credit metrics will strengthen into 2015 as it realizes continued growth in operations and cash flows."
Shares of Ryman (Ticker: RHP) closed Tuesday trading at $45.52, down slightly on the day. Year to date, they're up about 9 percent.