Pinnacle Gets $2.86 Billion in Loans Backing Ameristar PurchaseSridhar Natarajan
Pinnacle Entertainment Inc., owner of seven U.S. casinos, obtained commitments for as much as $2.86 billion in loans to support its acquisition of Ameristar Casinos Inc.
The financing is expected to be made up of a $1.94 billion term loan and a revolving credit facility of $925 million, the casino operator said in a regulatory filing today. The Las Vegas-based company may also seek a senior unsecured bridge loan of as much as $315 million if it is unable to sell senior unsecured notes of the same amount before the completion of the Ameristar acquisition.
The company was in talks with the U.S. Federal Trade Commission to settle a complaint looking to block its $2.8 billion acquisition of Ameristar that was announced in December, two people familiar with the matter said last month. Pinnacle has $1.44 billion in long-term debt with leverage, or the ratio of debt to earnings before interest, taxes, depreciation and amortization, of 5.8 times, according to data compiled by Bloomberg.
The acquisition will more than double Pinnacle’s operating properties to 17 in 13 different locations, the company said in a Dec. 21 statement.
In a revolving line of credit, money may be borrowed again once it’s repaid; in a term loan it can’t.