Las Vegas Sands to pay off $1 billion in debt through amendment of credit facility

Las Vegas Sands to pay off $1 billion in debt

NEW YORK — Las Vegas Sands said Wednesday it plans to pay off more than $1 billion in outstanding debt because of its previously announced amendment to a credit facility.

The casino and resort operator led by billionaire Sheldon Adelson says the amendment extends the maturity of nearly 75 percent of its $3.9 billion in term loans and pushes their maturity to 2015 and 2016.

In addition to strengthening its cash position and overall financial profile, the company also says the payment gives it the opportunity to grow its business in emerging gaming markets.

Las Vegas Sands Corp., which owns properties including The Venetian and The Palazzo in Las Vegas, expects the $1 billion payment to happen later this week.

After its pays off that chunk of debt, the interest rate on the remaining term loans will be at the London Interbank Offered Rate, or LIBOR, plus 2.75 percent. LIBOR is the rate that international banks charge for short-term loans to each other. The $980 million in term loans that were not extended as part of the amendment will continue to accrue interest at LIBOR plus 1.75 percent and will mature in 2013 and 2014.

The company said last month its booming business in China and a new casino in Singapore helped significantly narrow its second-quarter loss. It lost $4.7 million, or a penny per share, in the period, compared with a year ago loss of $222.2 million, or 34 cents per share.

The company reported long-term debt of $10.4 billion as of June 30.

Standard & Poor’s Ratings Services raised its corporate credit rating on the casino company to “B” from “B-” on the transaction and said its outlook is “Positive.”

“The rating upgrade reflects the substantial improvement to the company’s debt maturity profile that results from the completion of the amend-and-extend transaction,” Standard & Poor’s credit analyst Ben Bubeck said in a statement. “Furthermore, given the easing of the leverage covenant into 2012, the company’s financial flexibility and liquidity profile also improved.”

In addition to its properties in Las Vegas, Sands operates casinos in Bethlehem, Penn., Singapore and the Chinese gambling enclave of Macau. Nearly 80 percent of its revenue in the second quarter came from Asian business.

Shares of Las Vegas Sands rose 53 cents to $30.29. Earlier in trading shares hit a 52-week high of $30.47.