Macau-based casino operator MGM China Holdings Ltd has agreed with its lenders to amend and restate its Hong Kong dollar-denominated senior credit facilities.
The announcement was made by U.S.-based MGM Resorts International, which has a 51-percent stake in MGM China.
The new agreement will expand the facility by US$1 billion and extend the maturity by 18 months, MGM Resorts said.
The amended and extended facilities will consist of a US$1.55 billion equivalent term loan, an increase from the previous US$550 million term loan, and a US$1.45 billion equivalent revolving credit facility.
They amend and restate the existing US$2 billion credit facilities of MGM China, in their entirety, and extend the term of those facilities to April 2019, according to MGM Resorts.
“This financing will be used for general corporate purposes and will provide our company the financial flexibility to continue to invest in MGM Macau and develop MGM Cotai,” MGM China president and chief executive Grant Bowie (pictured) said in a statement.
MGM China is due to open its second Macau property in the autumn of 2016. The venue, MGM Cotai, is on reclaimed land at Cotai, an area that has become the city’s answer to the Las Vegas Strip. The scheme has an estimated budget of HKD23 billion (US$3 billion), excluding capitalised interest and land related costs.
The company is also to invest US$100 million this year to renovate its first and currently only Macau casino-hotel, MGM Macau.
The amended MGM China credit facilities will bear interest at a fluctuating rate per annum based on HIBOR (Hong Kong Interbank Offered Rates) plus a margin, initially set for a six-month period at 1.75 percent per annum. Thereafter, the margin (in the range of 1.375 percent to 2.50 percent per annum) will be determined by the company’s leverage ratio, the press release stated.
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