Macau casino operator Wynn Macau Ltd says it concluded a deal on Wednesday with Deutsche Bank AG, Singapore Branch, as global coordinator, for issuance of US$1.35-billion worth of senior notes to professional investors.
Wynn Macau said in a Thursday filing to the Hong Kong Stock Exchange that it intended to use the net proceeds from the exercise – projected to be nearly US$1.34 billion – “together with other sources of funds available to the company and/or cash on hand” to “repurchase and redeem in full” the notes due in 2021.
Such notes were issued in the aggregate amount of US$1.35 billion on dates in October 2013 and March 2014 respectively.
The new exercise involves US$600-million in 4.875-percent senior notes due in 2024 and US$750-million in 5.500-percent senior notes due in 2027. Nine other financial institutions have been appointed joint book runners for the new note exercise, and a further two institutions are to be joint managers.
Wynn Macau said it would seek to list the new notes on the Hong Kong bourse and had received an “eligibility letter” from the Hong Kong Stock Exchange on the matter. No date for such an exercise was mentioned in the filing. Wynn Macau has recently invested US$4.4 billion in a new Macau casino resort – Wynn Palace – on Cotai.
Certain covenants attached to the new notes and to some related indentures will “limit” Wynn Macau’s ability to “effect a consolidation or merger” or “sell, assign, transfer, convey or otherwise dispose of” any of its “substantial subsidiaries properties or assets,” said Thursday’s filing.
The indentures also contain a “change of control provision” that would, if triggered, “require the company to repurchase the notes at 101-percent of the principal amount,” plus any accrued and unpaid interest due immediately prior to such repurchase. Such provision could be triggered if the control of “all or substantially all” of Wynn Macau’s assets were to move out of the hands of the firm’s founder and chairman Steve Wynn, “or any of his related parties”, added the filing.
The document also states that if “any gaming authority requires a holder or beneficial owner of the notes to be licensed, qualified or found suitable under any applicable gaming law and the holder or beneficial owner fails to apply or become licensed or qualified within the required time period or is found to be unsuitable by any gaming authority,” the company would have the right to require such investor to dispose of its notes or redeem them.
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Vitaly Umansky, Kelsey Zhu and Tianjiao Yu
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