MGM Growth gets best coupon in its history; liquidity is $2 billion

By Devika Patel

Knoxville, Tenn., Feb. 16 – MGM Growth Properties LLC management is pleased with the balance sheet after completing two debt offerings in 2020, one of which raised $750 million at the best coupon in the company’s history, and keeping leverage within the company’s targeted range of 5x to 5.5x with liquidity at nearly $2 billion.

“Our balance sheet is well-positioned to continue to achieve accretive growth in 2021, with a liquidity position of nearly $2 billion, consisting of $626 million of cash and $1.34 billion of revolver capacity,” chief financial officer Andy H. Chien said on the company’s fourth quarter and year ended Dec. 31, 2020 earnings conference call on Tuesday.

“Our pro rata net leverage of 5.3x is within our targeted range of 5x to 5.5x,” he said.

The company completed two debt offerings last year, the first of which was in May.

“Throughout the year, we completed two upsized unsecured notes offerings to permanently finance our redemption of MGM’s $1.4 billion of operating partnership units,” Chien said.

“The first was in May, when we issued $800 million of 4 5/8% notes due 2025.

“This was upsized from the initial $500 million due to strong investor demand,” Chien said.

Then, in November, the company snagged the best interest rate in its history.

“Similarly, in November, we issued $750 million of 3 7/8% notes due 2029,” Chien said.

“We were able to price these notes at the best interest rate in the history of the company and also upsized the initial offering size from $500 million,” Chien said.

Management was pleased with the results.

“These results demonstrate the continued confidence the bond investors have in our cash flows for many years to come,” Chien said.

Adjusted EBITDA was $240.2 million for the quarter and $955.3 million for the year.

The company had $626.4 million of cash and cash equivalents as of Dec. 31, 2020 and $4.21 billion of total debt.

MGM Growth Properties is a Las Vegas-based real estate investment trust that acquires, owns and leases large-scale destination entertainment and leisure resorts.

© 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.