Scientific Games completes corporate refinancing

Scientific Games Corporation today announced that its wholly owned subsidiary, Scientific Games International, Inc., successfully completed a series of financing transactions, including a private offering of $900 million on its long term debts.

Among these transaction was a principal amount of its 5% senior secured notes due for repayment in 2025 at an issue price of 100%, a private offering of €325 million of new 3.375% senior secured notes due for repayment in 2026 at an issue price of 100%, a private offering of €250 million of new 5.5% senior unsecured notes also due for repayment in 2026.

These together with the euro secured notes and new 5.% Dollar Notes at an issue price of 100%, a $900 million upsizing and repricing of its term loan B facility under its credit agreement that reduced the applicable interest rate on the term loans to LIBOR plus 275 basis points, which was a 50-basis point reduction. There was also an increase in the availability under the revolving credit facility to $620.2 million through October 18, 2018, with a step-down in availability at that time to $445.7 million until the extended maturity date on October 18, 2020.

The net proceeds of the financing transactions will be used to redeem all $2.1bn of the company's 7% senior secured notes due for repayment in 2022, prepay a portion of the borrowings under its revolving credit facility, including accrued and unpaid interest thereon and pay related premiums, fees and expenses of the transactions.

These costs include the effect of cross-currency interest rate swap arrangements, the net impact of the financing transactions will be to lower the Company's annual cash interest cost by approximately $69 million at current rates, while extending maturities of $2.1bn of its debt from 2022 out to 2024, 2025, and 2026.

The new notes are guaranteed on a senior basis by Scientific Games and certain of its subsidiaries. The new 5% dollar notes and the secured euro notes are secured by liens on the same collateral that secures indebtedness under Scientific Games' credit agreement, the 2022 Notes, and the existing 5% senior secured notes due for repayment in 2025. The company also entered into new floating-to-fixed interest rate swaps and will remain focused on growing cash flow and deleveraging.

The new 5% dollar notes were issued under the same indenture pursuant to which SGI previously issued $350 million of the existing notes. The new 5% dollar notes and the existing notes are treated as a single series of debt securities for all purposes under that indenture, including, without limitation, waivers, amendments, redemptions and offers to purchase.

The new 5% dollar notes have terms identical to the existing notes, other than issue date and offering price and have the same CUSIP and ISIN numbers as, and trade together with, the Existing Notes, except that the new 5% dollar notes issued in offshore transactions under regulation S shall be issued and maintained under a temporary CUSIP number during a 40-day distribution compliance period commencing on the issue date.

The new notes have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities laws and, unless so registered, may not be offered or sold in the United States except pursuant to an applicable exemption from the registration requirements of the Securities Act and applicable state securities laws. The new notes are offered only to qualified institutional buyers in accordance with Rule 144A and to non-U.S. Persons under Regulation S under the Securities Act. The new notes are not being offered, sold or otherwise made available to any retail investor in the European Economic Area.


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