SBC News Voice of the Sports Betting Industry
Australian betting and media operator Tabcorp Holdings has moved to diversify its funding sources through the pricing of a $289m issue of long-term debts.
Issued to its investors in the US private placement market, the notes are scheduled to settle in March 2023, subject to customary conditions, and comprising two tranches denominated in US$.
The notes have a weighted average coupon of 7.75%, and after conversion into AU$ will total AU$425m, with AU$249m across seven seven years and AU$176m across 10 years.
Tabcorp’s Chief Financial Officer, Daniel Renshaw, said: “This successful debt raising is a positive endorsement of the strategy and execution of new Tabcorp post demerger by investors in the USPP market.
“This is a testament to our focus on financial strength as we diversify funding sources and extend our debt maturity profile. It will provide us with flexibility to pursue growth and further progress our transformation strategy.”
The ASX-listed firm, the market leader in Australia, plans to use proceeds from the notes to fund growth options in line with its strategy since the demerger of its Lottery and Keno unit from the Wagering and Media business.
Additionally, Tabcorp added that the funds will go towards ‘general corporate purposes’, as well as repayment of existing indebtedness.
The update comes a month after Tabcorp Chairman and Managing Director/CEO Bruce Akhurst and Adam Rytenskild updated the firm’s ASX investors on its financial progress.
In its first quarter of FY23 trading (June 2022-June 2023), group-wide revenue rose 18.7% year-on-year, as well as by 14.2% for the Wagering and Media division and 91.7% for its Gaming Services operation.
For Wagering and Media, revenue rose by 14.2%, with a 24.7% digital market share, up from 23.9% in the fourth quarter of 2022, and marking a recovery after the figure fell below 24% during the prior financial year. Additionally, Gaming Services’ revenue rose by 91.7%.
Commenting on the group’s standing and ambitions, Akhurst said: “We completed the demerger and are now a more focused company with a core focus – growing our digital revenue market share while putting our customers first.
“We have a renewed board and executive team and renewed energy to urgently transform the company. As you can see, we’ve emerged from the demerger with strong momentum.”
