MGM Mirage (MGM) said Friday that all holders who participate in
the company's pending debt swap will receive a $50 bonus per $1,000
of notes, not just those who tendered as of Thursday's bonus
deadline.
The heavily indebted casino giant late last month offered
eligible holders of $782 million in notes due next year to swap
them for up to $500 million of higher-yielding notes that mature in
2016.
The company didn't disclose how many of notes have been tendered
so far. Those that do by the Sept. 24 deadline will get $1,175 for
each $1,000 of the 2010 notes.
Gaming and entertainment companies were hit hard by the
financial crisis and recession, as their big debt loads - run up by
expanding during the real-estate bubble - have been a drag on them
as revenue plunged. Many have been swapping out near-term debt for
other financing as capital markets have loosened.
MGM has been struggling to remain in compliance with its debt
covenants and has been considering selling off properties to meet
looming obligations. In May, it said it would pay back $825.6
million in debt under its senior credit facility after a stock and
bond offering. Those offerings led the company to remove a
bankruptcy concern statement from a filing in June, saying there is
no longer "substantial doubt" about its ability to remain
operational.
MGM shares closed Thursday at $11.24 and weren't active
premarket.
-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291;
joan.solsman@dowjones.com