Marina Bay Sands, lenders to amend credit facility details

Jun 22, 2020 Newsdesk Latest News, Singapore, Top of the deck  

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Singapore casino operator Marina Bay Sands Pte Ltd has reached a deal with its lenders to amend an existing credit facility agreement. The announcement was made by the firm’s parent. U.S.-based casino operator Las Vegas Sands Corp.

Marina Bay Sands Pte Ltd is the operator of the Marina Bay Sands casino resort (pictured in a file photo), one of Singapore’s two casino properties. The other is Resorts World Sentosa, operated by Resorts World at Sentosa Pte Ltd, a unit of Genting Singapore Ltd.

The deal to amend the credit facility deal was reached on Thursday, with the lenders represented by DBS Bank Ltd as agent. The original credit facility agreement was dated from 2012.

The deal, according to Las Vegas Sands, “modifies the financial covenant provisions under the facility agreement” such that Marina Bay Sands Pte Ltd “will not have to comply with the leverage or interest coverage covenants for the financial quarters ending, and including, September 30, 2020 through, and including, December 31, 2021”.

It also extends to June 30, 2021, the deadline for the casino operator to deliver to the lenders “the quantity surveyor’s construction-costs estimate and the construction schedule” for the Marina Bay Sands expansion project.

Singapore’s government announced last year it had agreed to the expansion of the city’s two casino resorts. In return for their investment – an aggregate of SGD9 billion (US$6.45 billion) – the respective operators will continue to hold a duopoly on casino gambling in the city-state through to 2030, it was announced at the time.

Marina Bay Sands Pte Ltd’s amended credit facility permits the company to make dividend payments during the financial quarters through to December 31, 2021. Such dividend payments can be “unlimited” from the lending banks’ perspective if the ratio of the Singapore casino operator’s debt to consolidated adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) “is lower than or equal to 4.25 to 1”.

The dividend payments during the mentioned period have to be restricted at “up to SGD500 million per fiscal year” if the ratio of Marina Bay Sands Pte Ltd’s debt to consolidated adjusted EBITDA is higher than 4.25 to 1,” Las Vegas Sands said.

The payment of dividends is subject to additional requirements related to Marina Bay Sands Pte Ltd’s liquidity levels and its interest coverage ratio.

A number of casino operators and gaming equipment suppliers have in recent weeks announced fresh debt issuance exercises or the amendment of existing credit facilities, to help them face the financial challenges posed by the negative impact on business from the Covid-19 pandemic.

In its Friday filing on Marina Bay Sands Pte Ltd’s amended credit facility, Las Vegas Sands made no reference to Covid-19.

Nearly 200 shops, including tenant-run food and drink outlets, reopened on Friday at the mall at the Marina Bay Sands casino resort, the venue said in a message on its website. It coincided with the resort’s host city Singapore beginning phase two of an exit from Covid-19 countermeasures.

The gaming floors at Singapore’s two casino properties have been closed since April 7 and remain so.

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