NorthStar Gaming Secures $30M Credit Facility

NorthStar Gaming announced that it has secured significant investment, as well as additional credit support. According to the company’s leadership, this is NorthStar’s largest financing to date.

The Biggest Investment in NorthStar’s History

NorthStar Gaming said that it has entered into a credit agreement to secure a CAD 43.4 million ($30 million) senior secured first lien term loan facility. Subject to final approval from the TSX Venture Exchange, the credit facility will be made available by Beach Point Capital Management.

NorthStar added that Playtech and some of its subsidiaries have agreed to provide credit support for certain obligations under the facility.

The credit facility has a SOFR + 9.35% interest rate, with a SOFR floor of 4.40%. Amortization payment has been deferred for the first 30 months, after which NorthStar will pay 2.5% of the principal amount per year until the 42nd month after the closing date. Following that, it will pay 5% a year until the maturity date.

Speaking of which, the facility is set to mature on January 24, 2030. According to the company, the agreement would significantly bolster its business.

NorthStar Gaming said that the purpose of the credit facility is to bolster its continued growth by reinforcing its balance sheet. The company clarified that the proceeds will allow it to repay the aggregate CAD 9.5 million principal amount loaned to it by Playtech. In addition to that, the company will channel CAD 7 million into an interest reserve account.  

NorthStar will furthermore leverage the funding for working capital and general corporate purposes and will pay transaction costs related to the credit facility.

Playtech Backed NorthStar

As mentioned, NorthStar secured а credit guarantee from Playtech, allowing it to proceed with the transaction. As a result, NorthStar has issued 32,735,295 common share purchase warrants to Playtech, allowing it to purchase stock at a price of CAD 0.055 per share. This notably reflects a premium of roughly 8.7% to the five-day volume-weighted average price of the shares as of January 24.

Playtech, for context, is an insider of NorthStar Gaming. The issuance of the bonus warrants would therefore constitute a “related party transaction.”

NorthStar Thanked Beach Point for Its Trust

NorthStar Gaming’s chair and CEO, Michael Moskowitz, called the financing a “pivotal moment for NorthStar.” According to him, the new credit facility will significantly bolster the company’s ability to scale operations and drive profitability.

We are grateful to Beach Point Capital Management for their trust in our strategy and vision. We are also thankful for Playtech’s steadfast partnership which was instrumental in securing this funding, reinforcing their value both strategically and as a technology provider.

Michael Moskowitz, chair & CEO, NorthStar Gaming

Beach Point’s managing director, Gabriel Fineberg, was likewise pleased with the agreement, praising the growth of NorthStar and the iGaming sector as a whole. He emphasized that his team trusts Playtech’s contribution and vision towards NorthStar’s success.

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