Malaysia’s Genting Bhd says its indirect wholly-owned unit GOHL Capital Ltd completed on Tuesday book building and pricing for an offering of US$500-million in 4.25-percent guaranteed notes due in 2017. The notes have been offered entirely offshore and outside the United States, said the company.
The new notes supplement the US$1-billion of guaranteed notes with the same coupon that were issued by Genting Overseas Holdings Ltd Capital on January 24. The US$1-billion in notes was listed on the Hong Kong Stock Exchange the following day.
The group expects the additional notes to be listed in Hong Kong “on or around” October 18. Genting said the additional notes have been rated “Baa1″ and “A-” by, respectively, Moody’s Investors Service Inc and Fitch Ratings Ltd.
The gaming conglomerate said it expected the net proceeds of the additional notes to be used “to replace certain borrowings [of the] group and for other general corporate purposes, including … operating expenses, capital expenditure, investment, refinancing, working capital requirements, general funding requirements and/or making investments in other members of the group, which may include investments for the development of Resorts World Las Vegas and/or other projects”.
In May a press release, Genting Americas Inc – a unit of the group – said it expected full-scale construction of Resorts World Las Vegas, on the Las Vegas Strip in the United States, would begin in the third quarter this year, with the aim of opening the property in 2020. No update on the budget for the venue was given in the May announcement, although a May 2015 note from an analyst at Malaysian financial institution Maybank IB Research said US$4 billion in capital expenditure had once been earmarked for it.
The Genting group also has its eyes on a Japanese casino licence, should the necessary legislation be passed in that country to create a local industry.
On October 2, Singapore casino operator Genting Singapore Plc announced that it had applied to offer Japanese-yen denominated bonds in Japan “for working capital and general corporate purposes in Japan”. It didn’t specify either an amount or a pricing for the notes.
Reuters news agency reported on Wednesday that Genting Singapore had begun marketing its yen-denominated bonds. According to the media outlet, the yen-denominated bonds have three tranches and the pricing is expected to be set on October 18.
In a Monday memo, credit agency Fitch Ratings Inc affirmed Genting group as having an “A-” rating with a “stable” outlook.
Fitch said that it expected the Genting group to move into a position of net debt in the coming years due to higher capital expenditure as it seeks to expand its markets.
Genting Malaysia has been revamping and opening new facilities at its Resorts World Genting complex in Malaysia, under its Genting Integrated Tourism Plan (GITP). GITP is a multi-phase initiative described as a 10-year, MYR10-billion (US$2.37 billion) master plan for a major revamp for Resorts World Genting.
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”Our own consensus is that any newcomers to this [junket] sector should be corporatised, and should be financially sound and able to commit a higher guarantee deposit”
Kwok Chi Chung
President of junket trade body, the Macau Association of Gaming and Entertainment Promoters