Scientific Games Corporation announced that its wholly owned subsidiary, Scientific Games International, Inc., successfully completed a series of financing transactions, including a private offering of $900 million additional aggregate principal amount of its 5 percent senior secured notes due 2025 at an issue price of 100.0%; a private offering of €325 million of new 3.375% senior secured notes due 2026 at an issue price of 100 percent; a private offering of €250 million of new 5.5 percent senior unsecured notes due 2026; re-pricing of its term loan B facility under its credit agreement that reduced the applicable interest rate on the term loans to LIBOR plus 275 basis points, which was a 50-basis point reduction, and an increase in the availability under the revolving credit facility to $620.2 million through October 18, 2018, with a step-down in availability at that time to $445.7 million until the extended maturity date on October 18, 2020.
The net proceeds of the financing transactions will be used to redeem all $2.1 million of the Company’s 7 percent senior secured notes due 2022, prepay a portion of the borrowings under its revolving credit facility, including accrued and unpaid interest thereon and pay related premiums, fees and expenses of the transactions.
Including the effect of cross-currency interest rate swap arrangements, the net impact of the financing transactions will be to lower the company’s annual cash interest cost by approximately $69 million at current rates, while extending maturities of $2.1 billion of its debt from 2022 out to 2024, 2025, and 2026.
The new notes are guaranteed on a senior basis by Scientific Games and certain of its subsidiaries. The New 5 percent dollar notes and the secured euro notes are secured by liens on the same collateral that secures indebtedness under Scientific Games’ credit agreement, the 2022 notes, and the existing 5 percent senior secured notes due 2025.
The company also entered into new floating-to-fixed interest rate swaps and will remain focused on growing cash flow and deleveraging.
