Station Casinos cancels exchange offer for five series of notes

By Angela McDaniels

Tacoma, Wash., Dec. 15 - Station Casinos, Inc. said it has determined that some of the conditions to its private exchange offer for five series of notes will not be satisfied and that it is terminating the offer.

No term loans will be issued in exchange for notes, and all tendered notes will be returned, according to a company news release.

The company was offering to issue new 10% senior secured term loans due 2016 and new 10% junior secured term loans due 2016 in exchange for its 6% senior notes due 2012, 7¾% senior notes due 2016, 6½% senior subordinated notes due 2014, 6 7/8% senior subordinated notes due 2016 and 6 5/8% senior subordinated notes due 2018.

The offer began on Nov. 25 and was set to expire on Dec. 23. The consent date was going to be Dec. 19.

For each $1,000 principal amount of notes tendered by the consent date, the company planned to issue $540 of loans for the 6% and 7¾% notes and $200 of loans for the remaining notes. The amount included a consent payment equal to $30 principal amount of loans.

Noteholders would have also received accrued interest up to but excluding the expiration date.

Acceptance of the notes under the exchange offer would have been subject to proration. Station Casinos planned to issue up to $459 million of senior secured term loans in exchange for the 6% and 7¾% notes.

If the maximum amount had not been reached, Station Casinos would have then issued senior secured term loans in exchange for 6½%, 6 7/8% and 6 5/8% notes tendered.

Finally, Station Casinos would have issued junior secured term loans in exchange for all remaining notes tendered in the offer for up to 90% of the principal amount of the old notes on a pro rata basis.

The loans would have been guaranteed by subsidiaries of the company and secured by substantially all of the assets of the company and restricted subsidiaries.

Concurrently with the issuance of the loans, the company planned to borrow between $450 million and $500 million from entities affiliated with the company's equity owners or investors in related entities that own an indirect economic interest in the company.

The receipt of the loans from sponsors was expected to be provided as a new tranche of loans under the company's senior secured credit facility with Deutsche Bank Trust Co. Americas as administrative agent and collateral agent. Under these planned loans, which were a condition to the completion of the offer, interest could have been paid in kind rather than in cash and security would have been provided by a second lien on the collateral securing the company's senior secured credit facility.

Previously, the company said it was in discussions with sponsors regarding the terms of the loans but had not received any commitments.

The purpose of the offer and new financing was to significantly reduce the outstanding principal amount of debt and cash interest expense, Station Casinos said previously.

The offer was conditioned on at least 60% of the notes being tendered and was being made only to qualified institutional buyers and to certain non-U.S. investors.

D.F. King & Co., Inc. (800 628-8532 or collect 212 269-5550) was the information agent.

Station Casinos is a Las Vegas-based gaming and 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.