MGM China terminates $750-million loan from MGM Resorts Int’l

The primary owner of MGM Resorts International, MGM China Holdings Ltd., the Macau casino operator, announced the termination of a US$750 million revolving credit agreement.

From a commercial perspective, it was determined that the financing facility, which was established during the COVID-19 pandemic, was unnecessary.

Started in November 2022, the subordinated loan arrangement was designed to meet MGM China’s future financing and working capital requirements. However, with the easing of COVID-19 travel restrictions to Macau in late 2022, a significant rise in revenue was seen in 2023. Due to the significant improvement in market conditions, the loan arrangement was no longer required.

The board of MGM China and MGM Resorts came to a voluntary decision on March 15 to terminate the whole, unused US$750 million commitment.

In a note published on Monday, Moody’s Investors Service Inc. upgraded MGM China’s credit rating from “negative” to “stable,” noting improved financial performance and favorable market conditions.

In February, MGM China said that their 2023 revenue was HKD24.68 billion (US$3.16 billion), signifying an astounding 368.5 percent increase from 2022. This revenue figure also represented 108.4% of the HKD22.77 billion in total revenue for the pre-pandemic business year 2019.

Original story by: GGRAsia