Mohegan Tribal Gaming offers $1.175B of secured notes to repay debt

Mohegan Tribal Gaming Authority (doing business as Mohegan Gaming & Entertainment) is offering $1.175 billion of five-year (non-call two) secured notes. An investor call is scheduled for today at 11:30 a.m. ET, according to market sources. Pricing is scheduled for Friday, Jan. 15.

Joint global coordinators are Deutsche Bank (lead and broker/dealer) and Goldman Sachs. Joint bookrunners are Citizens Capital Markets, Fifth Third, Credit Suisse, Truist, BofA Securities and KeyBanc Capital Markets.

Net proceeds of the notes and borrowings under a new senior secured credit facility, together with cash on hand, will be used to fund the repayment of certain existing debt. The completion of the notes offering is conditioned upon, among other things, the replacement of the senior secured credit facilities with a new revolving credit facility, or an amendment and restatement of the credit facilities into a new revolving credit facility, in either case with commitments of not less than $250 million, prior to or substantially concurrent with the consummation of the proposed notes, according to an offering memorandum.

As of Sept. 30, 2020, amounts outstanding totaled $231.9 million under the company’s existing term loan A, and $813.6 million for the existing term loan B.

The new notes will feature a springing maturity date that is 91 days inside the company’s existing 7.875% senior notes due 2024. Additionally, structure will allow the issuer to redeem up to 10% of the notes at 103% of par per annum during the non-call period.

The 7.875% senior notes currently represent the issuer’s lone outstanding bond maturity. These bonds were placed in September 2016.

Mohegan Tribal Gaming Authority owns, operates, and develops gaming facilities in the United States. Issuer corporate ratings are CCC+/Caa2.