LVS issues US$1.75 billion to repay existing debt

Casino group Las Vegas Sands Corp., the parent company of Macau casino operator Sands China, will issue $1.75 billion in senior unsecured bonds, according to Tuesday’s forecast. Proceeds from the issue will be used to refinance the company’s $1.75 billion due in August this year.

The notes will be issued in three tranches: $750 million is the senior note due June 2027, $500 million is the 6.000% note due August 2029, and $500 million is the 6.200% note due August 2034.

Las Vegas Sands also operates Marina Bay Sands Casino Resort in Singapore.

Moody’s gave Las Vegas Sands a “Baa3” rating on the issue of the proposed note. “All ratings for the company remain unchanged, including the existing “Baa3″ rating for senior unsecured notes,” the rating agency said in a report on Tuesday. Casino Group’s outlook is “stable,” the agency added.

According to Moody’s, refinancing at Las Vegas Sands “improves the company’s maturity profile.”

“The stable outlook reflects our expectations that visits and gaming revenue will continue to grow in 2024, allowing Las Vegas Sands to recover its credit metrics to levels consistent with our expectations,” the ratings agency added.

“Given Macau’s continued recovery, Singapore’s strength and deleveraging from EBITDA [earnings before interest, taxation, depreciation and amortization] growth, we are well positioned to target debt capital markets to address maturities in 2024,” CBRE Capital Advisors Inc. observed in a note on Tuesday.

“This issue was expected and with the 2024 maturities resolved, Las Vegas Sands’ focus could shift to $1.8 billion due in Sands China in 2025 and another $500 million in Las Vegas Sands level,” analysts Colin Mansfield and Connor Parks wrote.

“Las Vegas Sands should be a regular unsecured issuer over the next few years and its credit profile provides two strong global gaming jurisdictions, a carefully managed balance sheet and shareholder revenue strategy, and exposure to moderate leverage,” they added.

Las Vegas Sands’ total leverage in the first quarter “improved from 3.6 to 3.3 times quarter-over-quarter, primarily driven by EBITDA growth,” according to CBRE

“In the first quarter of 2024, [Las Vegas Sands] management reiterated its commitment to its longstanding financial policy of maintaining investment ratings and total leverage of 2.0 to 3.0 times,” the CBRE team said.

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