Shares surge for casino firm
Posted by Chloe Flint on 21 Aug 2009 at 15:08
Casino giant Las Vegas sans got a big boost on the stock market in America on Thursday after the firm revealed it had applied for a possible listing in Hong Kong which could raise as much as two billion dollars this year.
The company, run by entrepreneur Sheldon Adelson, announced it had filed an application with the Hong Kong stock exchange.
However it said there were not yet any details on the timing or terms of the offering, a filing to the Securities and Exchange Commission said.
The Financial Times reported the company has been thinking of making a Hong Kong public offering of its Macau assets for some time.
The company is looking to raise additional funding to finish partially built projects in the Chinese gambling haven.
Last week it was revealed the company had secured an amendment to a $3.3 billion credit facility.
This allowed the company to investigate the listing and sell a minority interest of its Asian businesses. As a condition, $500 million of the proceeds have to be used to repay debts.
The company has been struggling to keep up with its repayments and has said lenders have given the green light to six quarters of relief from its covenants, plus the option of issuing as much as $1.5 billion in bonds.
The firm has not revealed how much it hopes to raise in Hong Kong, but analysts have said the size of the listing could be from one billion dollars to two billion dollars according to the Financial Times. The timing could see it take place in November or December.
Analyst JP Morgan was quoted by the Financial Times as saying: “We believe this moves LVS one step closer to a clearer path of much-needed improving liquidity and balance sheet de-levering,"
When it does go ahead the move is likely to be a significant boost for its balance sheet, as the company has been forced to halt construction at projects in Macau and has also cut jobs as it battles financial difficulties.
Macau continues to have a tough time of it, battling the global recession and a fall in visitor numbers thanks to tougher visa restrictions on Chinese visitors.
Gaming revenues for the first half went down 2.4 per cent compared to the same period last year to 6.4 billion dollars.
The company's shares rose 3.5 per cent to reach $13.19 on Thursday after touching a high of $13.47 earlier. This contributed to a jump of around 40 per cent for the stock this month, the Financial Times added.
