Golden Entertainment gets $1.1 billion credit facilities commitment

By Sara Rosenberg

New York, June 12 – Golden Entertainment Inc. plans on getting $1.1 billion of credit facilities to help fund its acquisition of American Casino & Entertainment Properties LLC and refinance existing debt, according to an 8-K filed with the Securities and Exchange Commission on Monday.

J.P. Morgan Securities LLC, Credit Suisse Securities (USA) LLC, Macquarie Capital (USA) Inc. and Morgan Stanley Senior Funding Inc. are the leads on the deal.

The facilities consist of a $100 million five-year revolver, an $800 million seven-year covenant-light first-lien term loan and a $200 million eight-year covenant-light second-lien term loan.

As committed, pricing on the revolver is expected at Libor plus 300 basis points with a 0% Libor floor, pricing on the first-lien term loan is expected at Libor plus 300 bps with a 0.75% Libor floor, and pricing on the second-lien term loan is expected at Libor plus 700 bps with a 0.75% Libor floor.

The first-lien term loan is anticipated to have 101 soft call protection for six months, and the second-lien term loan is anticipated to include call protection of 102 in year one and 101 in year two.

Amortization on the first-lien term loan is 1% per annum.

Under the agreement, the purchase consideration will consist of $781 million cash plus about 4 million shares of Golden Entertainment stock issued to American Casino’s current owner, Whitehall Street Real Estate Partners 2007, a real estate private equity fund managed by the Merchant Banking Division of Goldman Sachs.

Pro forma net leverage is expected to be less than 5.5 times at closing.

Pro forma for the completion of the transaction, the combined company would generate around $847 million of net revenues in 2017 and about $180 million of EBITDA in 2017, including $18 million of estimated run-rate synergies.

Closing is expected by year-end, subject to regulatory approvals. The transaction is not subject to a financing condition.

Golden Entertainment and American Casino are Las Vegas-based owners and operators of gaming properties.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.