Harrah’s to issue $1 billion in debt in private offering

Wednesday, May 27, 2009 | 8:29 a.m.

Headlines from the Vegas gaming industry

Harrah's Entertainment Inc. has announced plans to issue $1 billion in new debt.

In a statement dated Tuesday, the gaming operator said subsidiaries Harrah’s Operating Escrow LLC and Harrah's Escrow Corp. would issue $1 billion of senior secured notes due 2017 in a private offering that is exempt from federal securities registration requirements.

Harrah’s intends to use a portion of the cash raised in the offering to retire a portion of Harrah’s existing debt and for general corporate purposes.

Because of uncertainties about its financial performance, Harrah's debt has been trading at a discount. The company has taken advantage of this by swapping old debt for new debt and cash, overall reducing its debt burden and annual interest expenses.

During the first quarter, Harrah's completed debt exchanges that reduced debt by $1.8 billion and annual interest expenses by $73 million at Harrah's Operating Co.; and overall for Harrah's Entertainment that cut debt by $2.3 billion and reduced yearly interest costs by $104 million.

Previously, the Las Vegas company for the first quarter of 2009 reported that revenue fell 13.3 percent from the 2008 quarter to $2.254 billion. The company's loss from continuing operations narrowed, from $275 million in the 2008 quarter to $127.4 million in the 2009 quarter.

Discussion: 5 comments so far…

By goingbust

5/27/09 at 9:31 a.m.

Suggest removal

Sure. I will give them my money today so I can receive 10 cents back at the bankruptcy court in 18 months. Good deal!
By rumrunner

5/27/09 at 10:20 a.m.

Suggest removal

After how they put 750 families out in 30 days,and as it looks for no damn good reason,they are getting what they gave out! I for one hope they tank!!!! And if you dont get what i mean,go down koval and just look what is in place of where these people used to live!
By gettocard

5/27/09 at noon

Suggest removal

One thing and one thing only comes to my mind : will Gary "fatso" Loveman lose some weight because of the stress ?? He may gain a bit actually....

Andrew
Italy
By greenphantom

5/29/09 at 3:36 a.m.

Suggest removal

Gary Loveman has dragged Harrahs to its lowest point. What is sad, the employees (which I am one) has suffered from the cutbacks, wage freezes, reduction in benefits. He preaches guest service but does not give us the tools we need to give great customer service.