Japanese gaming giant Universal Entertainment Corp says it has commenced preparations to issue additional notes to fund the redemption of US$118 million of existing notes due December 2021.
The additional notes are intended to redeem the outstanding US$118 million principal amount of existing notes after Universal had previously redeemed US$482 million of the original US$600 million outstanding notes last September.
The company had announced at the time that it would seek approval from holders of the US$600 million existing notes to amend their due date from 11 December 2021 to 11 December 2024 while maintaining an interest rate of 8.5% per annum.
That plan, which required the approval of 100% of existing notes holders, fell through after Universal received valid tenders and consents representing only 80.3% or US$482 million worth of the notes.
Instead, Universal implemented an exchange offer – which required only 75% approval – for US$482 million of new notes due 11 December 2024. The remaining US$118 million in notes were left for redemption on 11 December 2021, however Universal said Friday it will now redeem them early via the additional notes offering.
The issue of additional notes and early redemption of existing notes “are intended to improve the company’s cash flow and secure its liquidity,” Universal said.
The company recently reported a net loss attributable to owners of the parent of JPY5.21 billion (US$47.6 million) for the three months to 31 March 2021.
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