MGM restructures US$950m in Macau loans

MGM restructures US$950m in Macau loans

MACAU MGM Resorts International has restructured US$950 million in loans to its MGM Macau resort, a step toward its planned Hong Kong IPO.

MGM Grand Paradise SA, the subsidiary that owns MGM Macau, says the refinancing of senior secured credit facilities will provide the company with additional liquidity.

Some gaming analysts believe the loan restructuring was necessary before MGM Resorts and joint-venture partner Pansy Ho could move ahead with its listing on the Hong Kong Stock Exchange.

“We are gratified by the overwhelming support from our financial partners,” says MGM resorts CEO Jim Murren. “We have made significant progress in building our revenues at MGM Macau, which has resulted in a positive impact on our cash flows. We view the significant investor demand on this transaction as validation of our progress.”

Says Ho: “Most notably, the new credit facility demonstrates the support of both the local banking community and the international financial market. This support enabled us to upsize the credit facility and provides us with a strong long term capital structure. Our goal has been to continue to develop the highest quality resorts in the Macau marketplace. We will continue to execute on our growth strategy while further enhancing Macau as a world-class destination.”

The new credit facility consist of a HK$4.3 billion (US$550 million) term loan and a HKD3.1 billion (US$400 million) revolving credit facility set to mature in July 2015.