LV Sands Close to IPO for Macau Operations

LAS VEGAS-The Hong Kong stock exchange IPO for Las Vegas Sands Corp.’s assets in Macau could come as early as next month and raise as much as $2.5 billion for the locally based casino operator, according to a Wednesday article in the South China Morning Post Citing sources familiar with Sands’ plans, the article states that LVS wants to have its listing hearing at the Hong Kong stock exchange by the end of this month, receive regulatory approval shortly thereafter and list the shares in mid-November. The number of shares it will offer, how much of the Macau unit that number will represent and the price at which they will be offered has yet to be disclosed. The plan is to use proceeds to pay down debt and continue expanding in Macau.

LVS filed an application for the listing in August, shortly after negotiating a deal with the of Nova Scotia whereby it is now allowed to sell as much as a 49.9% stake in its Macau operations-as long as a healthy chunk of the net proceeds are used to pay down its subsidiaries’ $3.3-billion credit facility with the bank. The allowance, from not being allowed to sell any stake in the operations, was part of an amended credit agreement that gives Sands a six-quarter breather from some of the requirements of its related debt agreements. All told, the company is struggling under the weight of nearly $10.8 billion in debt.

Two weeks ago, Wynn Resorts offered up a 25% stake [1.25 million shares ] in its Macau operations on the Hong Kong stock exchange at the top of a previously disclosed range [US $1.30 per share} and quickly sold out. The offering generated $1.625 billion not including overallotment reserves, which totaled 187 million shares and generated an additional $244 million in gross proceeds. Bloomberg reported the same say that that the pricing represented 14.5 times next year’s EBITDA as estimated by the banks involved in the sale.