Moody’s Ratings has assigned a ‘B1’ rating to MGM China Holdings Ltd’s proposed senior unsecured notes, which the institution said in a Monday memo would be for a principal amount of US$500 million. The Macau casino operator said the same day that it was planning to conduct an international offering of notes “to professional investors only”.
MGM China is a 55.95-percent owned publicly traded subsidiary of U.S.-based MGM Resorts International.
The Macau unit said it intended to use the net proceeds of the notes – at the time of its statement the firm said the principal amount was yet to be determined – “to repay a portion of the amounts outstanding” under the firm’s “revolving credit facility and for general corporate purposes”.
MGM China said it would be “permitted to reborrow such amounts under the revolving credit facility”.
Moody’s stated in its Monday memo: “The proposed refinancing is leverage neutral, as the company had recently drawn on the revolving credit facility to repay its US$750 million notes which matured in May 2024, and pushes out the maturity of a portion of the company’s debt.”
MGM China runs the resorts MGM Macau (pictured) and MGM Cotai in the Macau market.
In March, Moody’s said it had updated the credit outlook for MGM China to ‘stable’ from ‘negative’. “MGM China has experienced sustained improvement in Macau, which has accelerated significantly over the last 12 months,” stated the rating agency at the time.
That same month, MGM China said it was terminating a US$750-million revolving loan facility made available by MGM Resorts amid the Covid-19 pandemic, as it is “not commercially necessary” now.
