Genting Malaysia units issue additional US$100m senior notes at 7.25%

KUALA LUMPUR (Sept 17): Two of Genting Malaysia Bhd’s (KL:GENM) subsidiaries, video lottery facility operator Genting New York LLC (Genny) and its unit Genny Capital Inc, have priced an additional US$100 million (RM427 million) of 7.25% senior unsecured notes, due 2029.

This came after the two indirect wholly-owned units priced an offering of US$525 million of 7.25% senior unsecured notes, also due 2029, last Tuesday.

"These additional notes form part of the same series as the initial US$525 million aggregate principal amount of notes that were priced on Sept 10, 2024 (initial notes) and the additional notes will carry the same terms as the initial notes," Genting Malaysia said in a bourse filing Tuesday.

Net proceeds from the additional corporate notes will be used to repay existing debts. “Approval in-principle has been received for the listing of the notes on the Singapore Exchange Securities Trading Ltd,” it said.

Post-issuance, Genting Malaysia’s gross borrowings is expected to increase to RM17.69 billion from RM14.98 billion. Net gearing is expected to increase to 1.04 times from 0.81 times.

S&P Global Ratings has assigned a BB+ (stable) rating to the notes, with Fitch Ratings Ltd opting for BBB- (negative).

Genting Malaysia said the additional notes have been offered and sold only to individuals reasonably believed to be qualified institutional buyers without having to register the notes based on the US Securities Act 1993's requirements for exemption from registration, and to certain non-US individuals in transactions outside the US.

"The notes have not been registered under the Securities Act or any state or other jurisdiction’s securities laws. Accordingly, the notes may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements under the Securities Act and any applicable state or other jurisdiction’s securities laws," it said.

Citigroup Global Markets Inc and Wells Fargo Securities LLC are the joint global coordinators for the offering.

BofA Securities, Inc, JP Morgan Securities LLC, Mizuho Securities Asia Ltd, SMBC Nikko Securities America Inc, Fifth Third Securities Inc, KeyBanc Capital Markets Inc and US Bancorp Investments Inc are the joint bookrunners.

At the time of writing, shares in Genting Malaysia traded down three sen or 1.26% to RM2.36, giving the company a total market capitalisation of RM14.01 billion. Year to date, the stock is down 9.4%.