GGRAsia – LVS extends dividend pause to lift lender ban on Nevada sale

LVS extends dividend pause to lift lender ban on Nevada sale

Sep 06, 2021 Newsdesk Latest News, Macau, Singapore, Top of the deck, World

Las Vegas Sands Corp (LVS) has agreed with its lenders to extend the suspension of the casino operator’s dividend programme, until the end of 2022, unless it has more than US$1.0 billion in liquidity.

In return, a bank syndicate led by Canada’s Bank of Nova Scotia has agreed to relax a lending covenant that banned LVS from selling its Las Vegas, Nevada, venues and operations in the United States, said a Friday filing by the casino group.

LVS announced in early March it had agreed to sell its Las Vegas venues and operations for US$6.25 billion. The casino firm said it was “focused on reinvestment in Asia and high-growth opportunities in new markets.”

Las Vegas Sands is the parent of Macau casino operator Sands China Ltd, and Singapore casino operator Marina Bay Sands Pte Ltd.

The parent swung to an operating loss of US$139 million in the second quarter, compared to a loss of US$757 million in the same period in 2020, amid the Covid-19 pandemic.

LVS says it has negotiated a second waiver amendment to the conditions of a US$1.5-billion senior unsecured revolving credit facility provided by the bank syndicate.

The changes include the lenders agreeing to extend by one year, to December 31, 2022, the waiver period for the requirement whereby LVS had to ensure its consolidated leverage ratio did not exceed 4 to 1, on the last day of any financial quarter.

Under the newly-relaxed terms, Las Vegas Sands will need – during the relevant period – to maintain a minimum liquidity of US$700 million as of the last day of each month, twice as much as in the prior amendment.

In April 2020, Las Vegas Sands said it would suspend the company’s dividend programme, amid the negative impact of the Covid-19 pandemic. The group nonetheless said it would “continue previously-announced capital expenditure programmes in both Macau and Singapore”.

The company has an ongoing commitment to spend hundreds of millions of U.S. dollars on infrastructure in the Macau casino market, as it completes the revamp of one of its Cotai casino resorts as the Londoner Macao.

The company told GGRAsia it is “entering the final stage” before launch of the Londoner Court hotel at Londoner Macao. The company did not specify a launch date in its email to GGRAsia on Thursday.

The Londoner Macao had its first-phase launch on February 8, ahead of the Chinese New Year break.