Caesars to convert $71 million of revolver into term loan B-6

By Sara Rosenberg

New York, Feb. 22 - Caesars Entertainment Operating Co. Inc. has elected to convert about $71 million of its non-extended revolving commitments into its new term loan B-6 and has extended about $31.3 million of its revolver by three years to Jan. 28, 2017, according to an 8-K filed with the Securities and Exchange Commission on Wednesday.

In addition to the revolver funds, the term loan B-6 due Jan. 28, 2018 was created through the extension by three years of about $2.7 billion of term loan B-1, B-2 and B-3 debt.

As was previously reported, pricing on the new B-6 loan is Libor plus 525 basis points, after flexing up earlier from talk of Libor plus 450 bps if less than $3.25 billion of the company's term loan B-1, B-2 and B-3 debt was extended and Libor plus 475 bps if more than $3.25 billion was extended.

Upon the effectiveness of the amendment, the company will repay term loans of extending lenders in an amount equal to 40% of the principal amount of term loans elected to be extended.

Taking into account the repayment of a portion of the new term loan B-6, there will be about $1.8 billion outstanding under the tranche.

Also, the company will permanently reduce 20% of the revolver commitments of the extending lenders.

The extended revolver will be sized at around $25 million, the non-extended revolver will be around $1.1 billion and the non-extended term loans B-1, B-2 and B-3 will total around $2.1 billion.

Pricing on the non-extended term loan B-1, B-2 and B-3 is Libor plus 300 bps. Currently, the company also has about $1.2 billion of existing extended term loan B-5 debt due Jan. 28, 2018 that is priced at Libor plus 425 bps.

The non-extended revolver is priced at Libor plus 300 bps with a 50 bps unused fee.

The term loan B-6 has a springing maturity to April 14, 2017 if more than $250 million of the company's 11¼% senior secured notes due 2017 remain outstanding on that date, and, with the amendment, the company is adding this springing maturity to its existing extended term loan B-5.

In connection with the amendment and extension, the company sold $1.25 billion of senior notes, and up to $1 billion of the proceeds are being used for the term loan paydown.

Bank of America Merrill Lynch is the lead bank on the amendment and extension offer.

Lenders were offered a 10 bps fee for consents toward the amendment, which passed last week, and a 15 bps extension fee.

Caesars is a Las Vegas-based diversified casino-entertainment company.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.