Gaming supplier Scientific games Corporation announced that it is upsizing a previously announce offering of senior secured notes from $500 million to $900 million.
The company had previously announced that it plans to raise the equivalent of $1.21 billion via a mixture of secured and unsecured notes, via private offering, including an additional $500 million of its 5 percent senior secured notes due 2025, €325 million ($402 million) of senior secured notes due 2026, and €250 million of unsecured notes due 2026.
Scientific Games also announced the pricing of the private offering: an issue price of 100.0 percent for all new notes.
The group plans to use the net proceeds, together with a term loan facility of its credit agreement, to “redeem all US$2.1 billion of its outstanding 7.000-percent senior secured notes due 2022; repay borrowings under its revolving credit facility; pay accrued and unpaid interest thereon plus any related premiums, fees and costs; and pay related fees and expenses of the new notes offering.”
The offering is expected to close on February 14, Scientific Games stated.
“The company is actively in the credit markets looking to execute yet another major recapitalization that we estimate would save approximately US$42 million of annual interest expense,” brokerage Union Gaming Securities LLC wrote in note.
“The current refinancing plan also provides several strategic benefits, including hedging the company’s increasing euro currency exposure from the NYX acquisition, staggering maturities, and setting a benchmark for unsecured paper ahead of the 10 percent notes that are callable in December, which we believe could net US$65 million to US$80 million of incremental savings.”
