Las Vegas Sands (LVS) has begun its search for financing of up to SG$8 billion (US$5.9 billion) for expansion of its Singapore integrated resort, Marina Bay Sands (MBS).
Reuters is reporting that MBS has mandated four banks on the financing, which includes SG$4 billion of new debt plus an extension to its existing financing. It is the first time since 2012 – when it closed a SG$5.1 billion deal with 28 lenders – that MBS has sought new debt, although it has twice negotiated amendments and extensions in that time.
The substantial size of the proposed loan has led some local experts to suggest LVS may find it difficult to achieve.
“Marina Bay Sands would have to woo both existing and new lenders to achieve success with this exercise,” one banker was quoted as saying. “The borrower has not raised such a size before and it is also unprecedented for the market in Singapore.”
However, the strong track record of MBS will almost certainly work in its favor given the property’s reputation as the most profitable casino in the world. Despite some difficult trading conditions, MBS recently announced EBITDA of US$423 million in 1Q19 – contributing 29% of LVS’ combined EBITDA of US$1.45 billion for the period.
A Singapore-based loans banker at a large Chinese bank told Reuters, “We are keen to participate. There’s no issue for us to join a casino deal and take large take-and-hold positions in the sector.”
Both MBS and Genting Singapore’s Resorts World Sentosa were granted approval by the Singapore Tourism Board in April to embark on major expansion works, with each to spend around SG$4.5 billion (US$3.3 billion).
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