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VICI Properties Inc. Repays Secured Term Loan B Facility
Rhea-AI Impact
(Low)
Rhea-AI Sentiment
(Neutral)
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Rhea-AI Summary
VICI Properties (NYSE: VICI) announced the complete repayment of approximately $2,102.5 million of its Term Loan B Facility, funded by proceeds from a share issuance of 65 million shares and a forward sale agreement. This decision eliminates all secured debt from VICI's balance sheet, aligning with its goal of achieving an investment-grade capital structure. The company maintains its undrawn five-year first lien revolving credit facility. CFO David Kieske emphasized the disciplined capital allocation underpinning this strategic move.
Positive
Complete repayment of secured debt enhances balance sheet.
Maintains undrawn five-year first lien revolving credit facility.
Negative
Incurring breakage costs of approximately $66.9 million related to interest rate swap agreements.
NEW YORK--(BUSINESS WIRE)--
VICI Properties Inc. (NYSE: VICI) (“VICI Properties” or the “Company”), an experiential asset real estate investment trust, today announced the Company used net proceeds from the issuance of 65,000,000 shares of the Company’s common stock completed on September 14, 2021 and proceeds from settlement of the forward sale agreement entered into in June of 2020 (representing 26,900,000 shares of the Company’s common stock) to repay in full approximately $2,102.5 million of existing indebtedness, including accrued interest, under the seven-year senior secured first lien term loan B facility (the “Term Loan B Facility”) originally entered into in December 2017. In connection with the payoff of the Term Loan B Facility, the related interest rate swap agreements were also terminated and the Company incurred breakage costs of approximately $66.9 million. The Company’s five-year first lien revolving credit facility originally entered into in December 2017 remains in place and undrawn, following the repayment of the Term Loan B Facility.
“The repayment of the Term Loan B Facility retires all of the secured debt on VICI Properties’ balance sheet,” said David Kieske, Chief Financial Officer of VICI Properties. “Since VICI’s inception approximately four years ago, we have been committed to pursuing an investment grade capital structure and this repayment of the secured Term Loan B Facility continues VICI’s track record of disciplined capital allocation and ultimate goal of achieving an investment grade rating.”
About VICI Properties
VICI Properties Inc. is an experiential real estate investment trust that owns one of the largest portfolios of market-leading gaming, hospitality and entertainment destinations, including the world-renowned Caesars Palace. VICI Properties’ national, geographically diverse portfolio consists of 28 gaming facilities comprising over 47 million square feet and features approximately 17,800 hotel rooms and more than 200 restaurants, bars, nightclubs and sportsbooks. Its properties are leased to industry leading gaming and hospitality operators, including Caesars Entertainment, Inc., Century Casinos, Inc., the Eastern Band of Cherokee Indians, Hard Rock International Inc., JACK Entertainment LLC and Penn National Gaming, Inc. VICI Properties also has an investment in the Chelsea Piers, New York facility and owns four championship golf courses and 34 acres of undeveloped land adjacent to the Las Vegas Strip. VICI Properties’ strategy is to create the nation’s highest quality and most productive experiential real estate portfolio.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words “assumes,” “believes,” “estimates,” “expects,” “guidance,” “intends,” “plans,” “projects,” and similar expressions that do not relate to historical matters. All statements other than statements of historical fact are forward-looking statements. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors which are, in some cases, beyond the Company’s control and could materially affect actual results, performance, or achievements. Important risk factors that may affect the Company’s business, results of operations and financial position (including those stemming from the COVID-19 pandemic and changes in the economic conditions as a result thereof) are detailed from time to time in the Company’s filings with the Securities and Exchange Commission and include, among others, risks related to the method of settlement of the Company’s forward sale agreements, the form and amount of proceeds of such settlement and the ability to complete the acquisition of the land and real estate assets associated with the property known as The Venetian Resort and The Venetian Expo in Las Vegas, Nevada. The Company does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as may be required by applicable law.
What is the significance of VICI Properties' recent debt repayment on September 14, 2021?
The repayment of $2,102.5 million eliminates all the secured debt from VICI Properties' balance sheet, improving its financial stability.
How did VICI Properties fund the repayment of its Term Loan B Facility?
VICI funded the repayment through proceeds from a share issuance of 65 million shares and a forward sale agreement for an additional 26.9 million shares.
What are the implications of VICI Properties achieving an investment-grade capital structure?
Achieving an investment-grade capital structure enhances VICI's credibility and may lower borrowing costs in the future.
What breakage costs did VICI Properties incur in relation to its debt repayment?
VICI incurred approximately $66.9 million in breakage costs due to the termination of related interest rate swap agreements.
What is VICI Properties' strategy for its portfolio?
VICI Properties aims to maintain a high-quality and productive real estate portfolio focused on gaming, hospitality, and entertainment.
