Mohegan Tribal Said to Set Rate on $730 Million Refinancing Loan
Mohegan Tribal Gaming Authority, the operator of casinos in Connecticut and Pennsylvania, set the rate it will pay on a $730 million term loan to refinance debt, according to a person with knowledge of the transaction.
The six-year deal will pay interest at 4.5 percentage points more than the London interbank offered rate with a 1 percent minimum on the lending benchmark, said the person, who asked not to be identified because terms are private.
Lenders will receive portions of the loan, which is being issued at 99 cents on the dollar, as soon as today, the person said.
The transaction for the Uncasville, Connecticut-based company is part of a $955 million refinancing which includes a $125 million term loan A and $100 million credit line, both due in five years, according to data compiled by Bloomberg. Proceeds will repay bank debt due in 2015 and 2016 as well as tender for $200 million of 11.5 percent of second-lien notes that expire in 2017.
In a revolving line of credit, money may be borrowed again once it’s repaid; in a term loan it can’t. A term loan B is sold mainly to non-bank lenders such as collateralized loan obligations, bank loan mutual funds and hedge funds. A term loan A is sold mainly to banks.
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