Harrah’s releases debt-exchange offer results

Thursday, April 9, 2009 | 8:44 a.m.

Headlines from the Vegas gaming industry

Harrah's Entertainment Inc. of Las Vegas today disclosed the results of its latest effort to reduce its debt load and annual interest costs.

The company said a debt-exchange offer that expired Wednesday resulted in it accepting exchange notes with a principal amount of $5.55 billion, which it will exchange for $3.4 billion in new 10 percent notes due 2018 and about $102 million in cash.

The new debt has a longer maturity period and, in some cases, a higher interest rate.

The company also replaced $442 million in bridge loans with the new 2018 notes valued at $297 million.

Harrah's didn't say how much the exchanges will reduce its annual interest costs, which analysts have said are too high as the recession reduces cash flow at its 53 casinos and its resorts around the world.

The company reported total debt of $24.5 billion as of Dec. 31 and said it paid $1.7 billion in interest and other debt expenses last year.

Comments
Print
E-mail
Share
- Facebook
- Fark
- Digg
- Reddit
- Stumble
Tweet

Discussion: comments so far…

Comments are moderated by Las Vegas Sun editors. Our goal is not to limit the discussion, but rather to elevate it. Comments should be relevant and contain no abusive language. Comments that are off-topic, vulgar, profane or include personal attacks will be removed. Full comments policy. Additionally, we now display comments from trusted commenters by default. Those wishing to become a trusted commenter need to verify their identity or sign in with Facebook Connect to tie their Facebook account to their Las Vegas Sun account. For more on this change, read our story about how it works and why we did it.

Only trusted comments are displayed on this page. Untrusted comments have expired from this story.

No trusted comments have been posted.

By David001

April 9, 2009

10:59 p.m.

Flag

Harrah's does a lot of things right but they are not flawless. They get points for the whole customer relationship management- marketing- data base Total Rewards- portion of the equation but they have allowed their physical plants to lose their luster and they many of their brand's essence has deteriorated - cases in point - the Rio and Caesar's which were once at the top of their genre but are now also rans.
By climberx

April 10, 2009

10:41 a.m.

Flag

I'm not seeing how "the new debt has longer maturities," as the newspaper is reporting. More than 90% of the $5 billion in notes tendered, and 100% of the bridge loans tendered, had 2016 & 2018 maturities. Of the $1.2 billion of notes with 2010-2013 maturities, only 20% were tendered.