Boyd Gaming plans to tap Wall Street to pay off, refinance debt

By Steve Green

Tuesday, Oct. 26, 2010 | 8:49 p.m.

Boyd Gaming Corp. of Las Vegas late Tuesday announced plans to tap Wall Street to raise $500 million to pay off or refinance existing debt.

Boyd said it is offering $500 million of eight-year senior notes in a private placement transaction, subject to market, regulatory and other conditions.

The bonds will be guaranteed by certain of the company’s subsidiaries.

Boyd plans to use some of the funds from the offering to finance a tender offer also announced late Tuesday for all of its outstanding $158.832 million principal amount 7.75 percent senior subordinated notes due 2012.

“The company intends to apply the balance of the net proceeds from the ($500 million) offering to repay a portion of the outstanding revolving balance on its bank credit facility and to potentially refinance other existing indebtedness. The company could also use a portion of the net proceeds from the offering for general corporate purposes,” Boyd said in a statement.

The offer to purchase the 7.75 percent notes expires at 5 p.m. New York City time on Nov. 24.

Boyd is offering to pay $1,003.75 for each $1,000 principal amount of notes tendered.

The company didn’t immediately disclose the expected financial impact of the transactions, but refinancing of debt has been common in recent years by gaming companies as Wall Street remains receptive to the industry despite the current recessionary environment.

MGM Resorts International, for instance, this month raised more than $1 billion with debt and equity issuances.

Boyd, which is carrying some $2.35 billion in debt excluding the Borgata resort joint venture in Atlantic City, said Monday it would focus on deleveraging its balance sheet as it reported quarterly earnings and said it would decline an opportunity to buy the 50 percent of Borgata that it does not already own.