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Churchill Downs prices upsized $500M notes offering, $400M term loan B

Churchill Downs Inc. priced its upsized private offering of $500 million of senior notes due 2028 and priced a $400 million senior secured term loan B due 2024.

The notes offering, which had an initial target of $300 million, was priced to reflect a 4.75% annual interest rate, while the term loan B was priced at the London Interbank Offered Rate plus 200 basis points.

In addition, Churchill Downs is replacing its existing $500 million senior secured revolving credit facility due 2021 with a new $700 million senior secured revolver due 2022. The new revolver is expected to bear an interest rate based on LIBOR plus a spread determined by the company's total net leverage ratio.

The term loan B and revolver are anticipated to close simultaneously with the notes offering, which is scheduled to take place Dec. 27.

The company aims to use the net proceeds from the notes offering, along with proceeds from the term loan B and revolver, to redeem $600 million of its existing senior notes due 2021, to refinance the commitments and loans outstanding under the existing revolver and repay about $169 million of its existing term loan A, and to fund related transaction costs.