Las Vegas Sands Lends $1 Billion to Sands China After a Lockdown in Macau

Las Vegas Sands Lends $1 Billion to Sands China After a Lockdown in Macau

Major corporation LVS and its subsidiary Makao Sands China, an operator of resort services in Macao, have formalized a loan agreement. The reason for this was the local authorities’ announcement of quarantine in the administrative district.

Sands China has issued a press release to shareholders. It gives details on the conditions of the express loan. The sum requested is $1 billion. The operator received the credit on July 11, 2022. Under the terms of the deal, Sands China is obligated to repay it by July 11, 2028.

Within the first two years of the credit contract, a subsidiary can pay down interest in two ways:

  • In cash at the rate of 5% per year.
  • In-kind (not in cash) at a rate of 6% per year with the condition that the sum of these percentages will be added to the main credit amount.

After this period, the Macau resort developer agrees to repay the credit in a cash-only manner.

In February 2022, Las Vegas Sands’ bond rating was downgraded by the stock index to BB+. This rating is lower than the investment grade, making it impossible for Makao Sands to borrow from anyone other than the mother company. LVS now holds a 70 percent stake in Sands China.

Representatives of the largest corporation, which owns casinos in Las Vegas, commented that the loan was needed to support “working capital and general corporate goals of the group”.

Regarding the situation facing the sector in Macau because of the COVID-19 outbreak, LVS refrained. Clearly, the business environment for operator Makao Sands China is complicated, as all of the city’s casinos are closing due to the lockdown.

We would like to remind you that the Fair Play Arkansas group has filed a petition trying to revoke the approval of a casino in Arkansas.

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Publication Author
Marcus Steel
Author of news
Marcus was born in the USA. He graduated from The University & Jepson Herbaria, University of California, Berkeley in 2016. Then Steel unsuccessfully tried to work in his father's company. In 2020, he decided to open his own gambling project but couldn’t find investors.
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