SBC News Entain lowers payment margins on $ and € debt tranches

Entain lowers payment margins on $ and € debt tranches

The board of Entain Plc has informed the markets that it has secured new terms on the corporate debt arrangement of the FTSE 100 gambling group.

Updating investors, Entain announced the successful repricing of two of its existing ‘Term B‘ loans, which hold approximately $3bn of corporate net debt.

Entain’s bondholders have further agreed to authorise the pricing and allocation of new fungible add-ons of debt tranches equivalent to £600m.

Securing a new arrangement on its Term B loans, Entain has reduced the margin of a $1.74 bn loan due in October 2029 by 75 basis points to 275 basis points and removed an additional 10 basis point credit adjustment spread.

The FTSE firm has further reduced the margin of a €1.03bn term loan due in June 2028 by 50 basis points to 325 basis points.

Bondholders will allow Entain to access an additional $500m and €235m as fungible add-ons for the dollar-denominated and euro-denominated loans, respectively. The add-ons maintain the revised margins and were allocated at slight discounts.

Entain informed markets that net proceeds secured from new debt arrangements would be reserved to repay a bank loan of £300m from the first quarter of 2024 and help provide approximately £295m in additional liquidity after fees.

The refinancing actions were deemed net debt neutral as the repricing and add-ons will not change the forecasted cash interest costs for the current financial year.

Entain expects cash interest for the financial year of 2024 to be revised to about £265m, and the profit and loss interest charge, adjusted for specific accounting standards and fee amortisation, was anticipated to be around £285m.

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