LPC-GVC increases and amends term loan debt

By Claire Ruckin

LONDON, Dec (Shanghai: 600875.SS - news) 7 (Reuters) - GVC Holdings (Frankfurt: 6GI.F - news) , the multinational sports betting and gaming group, has increased a term loan by €50m, reduced pricing and amended documentation to enable considerable operational and financial flexibility, it announced on Thursday.

The financing coincides with an announcement that GVC has offered to buy Ladbrokes Coral (LSE: LAD.L - news) for up to US$5.2bn to create a global online and high street betting giant able to take on rivals and cope with a tougher regulatory environment.

The amended, covenant-lite documentation contains provisions that could make it easier for GVC to incur more debt and make acquisitions, banking sources said.

"Theoretically the changes will help them,” one of the sources said.

Bankers are starting to work on debt packages to back GVC’s potential acquisition of Ladbrokes Coral, although the gaming sector will put some banks off the deal, the sources said.

As a result of its latest financing, GVC’s term loan, which originally signed in March 2017, was increased to €300m. The additional €50m raised will be used for potential bolt-on acquisitions and general corporate purposes.

Nomura and Deutsche Bank (IOB: 0H7D.IL - news) led the deal, which has reduced the interest margin by 50bp to 275bp over Euribor at par, from 325bp over Euribor.

An accordion facility, which allows the incurrence of incremental debt subject to a net leverage test, has been increased from 2.25 times to 3.5 times.

The company also has a €70m revolving credit facility and there are no plans to draw on it at this time, the company said.

GVC, which has 79 million registered accounts and operates in 21 languages through names such as sportingbet and partypoker, previously bought bwin.party in 2016. (Editing by Christopher Mangham)