MGM China acquires $302 million revolving credit facility
MGM China Holdings received a HK$2.34 billion ($302 million) revolving credit facility, with the possibility to increase it to HK$3.9 billion ($503 million) if certain conditions are met.
The Macau-based operator’s decision came when the revenue of MGM Cotai and MGM Macau experienced drastic falls due to the COVID-19 pandemic. While the casinos were closed for a 15-day mandatory shutdown, they have been open since late February. However, the worldwide health and safety regulations kept the revenues to the bare minimum.
MGM reported earnings for Q1 ($271.9 million) 63% less compared to last year, taking into account it costs $1.5 million a day to keep the venues operational.
The revolving credit facility’s final maturity date is May 15, 2024. The facility has a margin in the range of 1.625% to 2.75%, with the final number being determined by “the company’s leverage ratio”.
The company added: “The proceeds of the revolving credit facility will be used for ongoing working capital needs and general corporate purposes of the Group.” While MGM China is dealing with the effects of the worldwide pandemic, there are internal changes as well. The chief executive Grant Bowie is set to retire by the end of May, and no successor has been named as of yet.
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