Wynn makes move for Aqueduct slots

12 October 2009

NEW YORK, New York -- As reported by Bloomberg: "Wynn Resorts Ltd. sold $500 million of bonds, 43 percent more than planned, as the casino company founded by billionaire Stephen Wynn bids to run New York City's first slot-machine contract.

"The 7.875 percent, first-mortgage notes due in 2017 priced at a discount to yield 8.25 percent, or 504 basis points more than similar-maturity Treasuries, according to data compiled by Bloomberg. The company's Wynn Las Vegas LLC unit issued the notes. Wynn had earlier planned to sell $350 million of debt. A basis point is 0.01 percentage point.

"Wynn is bidding to redevelop Aqueduct Racetrack in New York's borough of Queens and operate 4,500 slot-machine-style video-lottery terminals there. The Las Vegas-based company's offering likely reflects Wynn's "desire" to win the contract and raise cash for projects in Asia, including the Cotai Strip in Macau, Barbara Cappaert, a high-yield analyst at KDP Investment Advisors Inc., said today in a report.

"'Wynn is amassing cash and liquidity,' the Montpelier, Vermont-based analyst wrote. 'The show of strength -- cash, the ability to raise cash and the valuations now inherent in the equity of its Las Vegas and Macau subsidiaries -- make a strong case for what is expected to be a roughly $400 million to $500 million project.'

"Peebles Development LLC in partnership with MGM Mirage and Penn National Gaming Inc. are among the groups also seeking the New York contract..."