Scientific Games $300 million credit facility to launch Thursday

By Sara Rosenberg

New York, Dec. 1 - Scientific Games Corp. is scheduled to hold a bank meeting on Thursday to launch its proposed $300 million five-year senior secured credit facility, according to a market source. JPMorgan and Bear Stearns are joint bookrunners on the deal.

The facility consists of a $200 million revolver talked at Libor plus 200 basis points and a $100 million term loan talked at Libor plus 200 basis points, the source said.

There is also an uncommitted $100 million term loan greenshoe provision in the credit agreement. This incremental bank debt would be available post closing, if needed, primarily for general corporate purposes, the source added.

Security is substantially all of the assets of Scientific Games and its wholly owned domestic subsidiaries, including stock and other equity interests.

Proceeds will be used to replace the company's existing senior credit facility. A portion of the borrowings under the proposed facility would be used to repay a portion of the current outstanding term loan D debt.

The company is also planning on tapping the high-yield market with a $200 million senior subordinated note offering to repay a portion of the existing term loan debt and to finance the tender offer for the 12½% senior subordinated notes due 2010.

Furthermore, the company is looking to the convertible market for $225 million in convertible senior subordinated debentures with proceeds earmarked for existing term debt repayment as well.

At Sept. 30, there was $459.354 million in outstanding term loan D debt under the existing facility. The existing facility also contains a $75 million revolver.

Scientific Games is a New York-based provider of services, systems and products to both the instant ticket lottery industry and the pari-mutuel wagering industry.

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