Boston, MA 06/11/2014 (wallstreetpr) – Scientific Games Corp (NASDAQ:SGMS)‘s subsidiary Scientific Games International (SGI) intends to redeem the outstanding senior notes (9.25%) which are due in 2019.
Redemption process
The redemption price includes 104.625% of the principal amount, accrued and unpaid interest till date. The Notes are likely to settle down by July 7, 2014 as per the terms of the indenture.
In addition, SGI received tenders from its holders of ~$141 million (40.2%) in aggregate principal amount of the outstanding Notes as of tender offer’s early deadline of June 3, 2014. SGI purchased the tendered Notes for $1,021.25 for each $1,000 principal amount.
As per the consideration of the tender offer, holders who tendered their Notes before the early closing dates will receive an early tender amount of $25.00 for every $1,000 principal amount of the Notes, but cannot withdraw.
BofA Merrill Lynch acts as the dealer manager and solicitation agent for the tender offer.
Liquidity level
Scientific Games Corp (NASDAQ:SGMS) supplied technology based products and services to gaming and lottery industries. In October 2013, the Company acquired the largest gaming supplier – WMS for ~$1.5 billion.
SGI issued borrowings of $2.6 billion to finance the acquisition of WMS. It includes term loans of $2.3 billion and $300 million as revolving credit facility. The term loans mainly used to finance the acquisition process including the outstanding debt of WMS.
Scientific Games had available cash balances of $425.6 million, which includes $169.1 million as cash and cash equivalents and available borrowing of $256.5 million under revolving credit facility and net term loans of $2.28 billion.
Conclusion
Scientific Games and WMS integrate to increase its long-term revenue opportunities by leveraging the individual’s strength and capabilities. It helps them to expand into a new market, enlarge its gaming business and targets a large number of customers through geographic expansion. But, Scientific Games Corp (NASDAQ:SGMS) expects incremental costs and capital expenditures from the integration in FY2014.
