Bally’s Lands Increased Credit Facility Following Rhode Island Casino Sale

• Gaming company said it has approval to increase credit facility to $510 million
• Creditors also approved sale-leaseback transaction on Rhode Island casino

Bally’s announced Tuesday that it secured a commitment to increase its borrowing capacity on a revolving credit facility (RCF) maturing on Oct. 1, 2028, by $510 million.

That enhancement was made possible by existing RCF creditors representing $670 million in commitments signing off on the regional casino operator’s sale-leaseback (SLB) deal on its Twin River Lincoln Casino Resort in Lincoln, RI. That $735 million transaction was announced earlier this month.

Upon receiving similar consents to the SLB Transaction from holders of approximately $600 million of term loans, which represent approximately 32% of currently outstanding amounts, the Company will have received sufficient consent from its senior secured lenders to proceed with the SLB Transaction,” according to a statement issued by Rhode Island-based Bally’s.

Casino landlord Gaming and Leisure Properties (NASDAQ: GLPI) is acquiring the property assets of the Rhode Island casino. The real estate investment trust (REIT) is Bally’s primary landlord in several states.

Why it Matters for Bally’s

Both the increased RCF and the approval to divest the real estate of the Twin River Lincoln Casino Resort are essential to Bally’s efforts to gain financial flexibility and reduce debt.

In the Tuesday statement announcing the pair of aforementioned commitments, Bally’s noted it could reduce outstanding balances by as much as 19%. The sale of its interactive unit to Intralot is another avenue through which the casino operator could raise capital with which to lower debt.

“If the SLB Transaction is consummated, based upon the agreed amendments with Bally’s RCF lenders, and if similarly ratified by Bally’s term loan lenders, the combined outstanding balances of Bally’s term loans and first lien notes is expected to be reduced from approximately $2.4 billion to approximately $1.92 billion,” Bally’s said in the press release.

Bally’s Facing Some Big Spending

Bally’s ability to shore up its finances is crucial in any environment, let alone when interest rates remain high. Additionally, the operator could be facing significant expenditures related to its efforts to grow its land-based casino business.

Additionally, the company could use increased financial flexibility to potentially spruce up existing properties, some of which, according to customers, could use some refreshing.