IGT experienced a price drop at the beginning of June, and now they announce a multi-million dollar buy-back of notes. International Game Technology will purchase some outstanding notes. It is considered a buy-back.
The buy-back scheme is from outstanding notes that amount to over $436 million. The buy-back was announced on Tuesday, June 26, 2018. The completion of the buy-back for senior secured notes will happen by 2020. The note tender offer is going to help extend the weighted average maturity of the debt, according to International Gaming Technology.
The offer of Senior Secured Notes includes 4.125 percent of notes due in 2020. These represented by Regulation S global notes. There are 4.75 percent senior secured notes as well as a 3.5 percent initial coupon.
Holders are offered 1,166 principal amount for each of the 4.125 percent notes and $1,247 for the 4.75 percent notes. IGT said the offer is subject to conditions stated at the time of purchase to the note holders.
Lucid Issuer Services Limited is managing the offer and already most of the notes have been tendered, which was before the expiry date of Tuesday. In breaking down the figures, the Lucid Issuer Services Limited said about $305 million is in 4.125 percent notes.
The banks helping manage the buy-back include BNP Paribas, London Branch, Deutsche Bank and Société Générale. IGT announced the net debt they have rose from $200 million to over $7.52 billion. They will also have a net loss of $103 million in the first three months of 2018. The debt is attributed to foreign exchange fluctuations.
IGT Losses in First Quarter
IGT’s loss in the first quarter is not as significant as the $1.2 billion revenue that IGT was able to post for the first three months. The company may show a loss in certain aspects of their revenue, but the revenue earnings overall is showing a positive amount.
With the buy-back of the notes, they should be able to account for some of the losses and continue the growth course they are on for the company. The next news from IGT will most likely be their second quarter results, which the company has yet to discuss.
The big news is about the buy-back and ensuring that they offer the correct amount for the notes. The tendered amount for 4.75 notes is $130.7 million and they are going to satisfy the deal as much as possible.