River Rock Casino is trying to raise $205 million from investors to pay off $200 million in debt due in 12 days.
Financial analysts said Thursday the Geyserville casino faces a high risk of default if it can't refinance by the Nov. 1 deadline.
River Rock's debt already is considered risky, said John Zhao, an analyst with Moody's Investors Services in New York. Moody's downgraded River Rock's senior notes in August, citing delays in refinancing the $200 million debt issue.
The tribal casino is trying to refinance within a short timeframe "while financial markets remain precarious," Zhao said in an investor report Thursday.
"If the transaction does not close, the ratings will most likely be downgraded," he said.
Analysts at Standard & Poor's issued a similar warning Thursday.
But Moody's said it expects River Rock to generate positive cash flow over the next 18 months. The casino could get a credit upgrade if it completes the refinancing deal on time, Moody's said.
In a filing with U.S. securities regulators Wednesday, River Rock CEO David Fendrick said the casino would use the proceeds from its bond sale to pay off the outstanding debt and build an emergency access road to the Alexander Valley gaming facility.
The new notes would mature in 2018. Filings didn't disclose the interest rate or other terms, and River Rock representatives said Thursday they can't provide more information because of securities rules.
River Rock's existing debt was issued in 2003 and pays 9.75 percent interest.
River Rock Casino is owned by the Dry Creek Pomo Indian tribe. It is located on the tribe's 93-acre reservation off Highway 128 east of Geyserville.
The casino expects to report $30.5 to $31.5 million in net revenue for the quarter ending Sept. 30, along with $7.8 to $8.3 million in income before distributions to the tribe, it said Wednesday.
It has about $38 million in cash, casino officials said.
UPDATED: Please read and follow our commenting policy: