May 30, 2006 – Las Vegas Sands has nailed down a US$2.5 billion (HK$19.5 billion) loan package for its Venetian Macau subsidiary after at least half a year of seeking banks willing to fund its high-stakes bet on Macau's transformation into a convention and resort destination.The money will primarily fund the construction of the US$2.3 billion Venetian Macau namesake property and neighboring US$590 million Four Seasons Hotel Macau in the Cotai reclamation area between Taipa and Coloane islands, according to a previous filing with US securities regulators.
The casino resorts are to feature extensive meeting and retail space in the hope such facilities will persuade visitors to stay a few days. Most now leave the same day they arrive.
The loan package was arranged by Goldman Sachs, Citigroup and Lehman Brothers. In a new US filing, Las Vegas Sands did not list the banks joining the loan syndicate, but said the Bank of Nova Scotia, Sumitomo Mitsui Banking and Macau's Banco Nacional Ultramarino all played a role in the deal, which closed last Thursday.
The filing said the lenders would have priority on any asset sales by Sands' Venetian Macau unit. Sands officials have signaled plans to sell off the retail areas of the Venetian Macau resort, Four Seasons and four other neighboring resorts the company is building. In a presentation for investors earlier this month, officials put assumed proceeds from sale of the Venetian Macau resorts' one million-square- foot mall at US$2.47 billion.
The loan package consists of a US$1.2 billion seven-year term loan, a US$700 million six-year term loan, a US$100 million five- year term loan denominated in Macau patacas, and US$500 million in a five-year revolving credit line.
Venetian Macau will initially pay interest on the US dollar loans at its choice of either 2.75 percentage points above an adjusted Eurodollar rate or 1.75 percentage points above an unspecified second base rate.
The spreads will be reduced by 0.25 percentage point after completion of the Venetian Macau's construction.
Source: The Standard Hong Kong
