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MSG National enters $650 million term loan, $100 million revolver
By Wendy Van Sickle
Columbus, Ohio, July 7 – Madison Square Garden Entertainment Corp.’s indirect wholly owned subsidiary MSG National Properties, LLC entered into a senior secured credit agreement with JPMorgan Chase Bank, NA as administrative agent on June 30 that provides for a $650 million term loan facility and a $100 million revolver, each with a term of five years, according to an 8-K filing with the Securities and Exchange Commission.
Proceeds were used at closing to fully repay the obligations outstanding under MSG National Properties’ existing term loan and to pay fees.
The facilities include financial covenants requiring MSG National Properties and its restricted subsidiaries to maintain a minimum liquidity of $50 million; a minimum debt service coverage ratio that is initially 2 to 1, with a step-up to 2.5 to 1 in the fiscal quarter ending Sept. 30, 2024; and a maximum total leverage ratio that is initially 6 to 1 and steps down to 5.5 to 1 in the fiscal quarter ending Sept. 30, 2024 and 4.5 to 1 in the fiscal quarter ending June 30, 2026.
The credit facilities will mature on June 30, 2027.
The principal of the term loan is to be repaid in quarterly installments beginning with the fiscal quarter ending March 31, 2023, in an amount equal to 2.5% per annum, stepping up to 5% per annum in the fiscal quarter ending Sept. 30, 2025, with the balance due at the maturity.
Borrowings bear interest at term SOFR plus a margin ranging from 250 basis points to 350 bps, depending on total leverage ratio of the borrower and its restricted subsidiaries.
New York-based Madison Square Garden builds sports, media and entertainment brands.
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