Mohegan Gaming Authority Completes Major Refinancing With $1.2 Billion Notes Issuance

Mohegan Gaming Authority Announces Pressing Refinancing Moves

The Mohegan Tribal Gaming Authority, commonly referred to as Mohegan, has made significant strides in its financial strategies by recently announcing the closure of substantial refinancing transactions. This transaction includes the issuance of $1.2 billion in new secured notes, marking a significant financial milestone for the authority.

On April 10, 2025, Mohegan Escrow Issuer, LLC, which is a wholly-owned subsidiary of the Company, successfully executed a private offering amounting to $750 million in 2030 Notes, which bear an 8.250% interest rate, alongside $450 million in 2031 Notes that carry an elevated 11.875% interest rate. These new securities are an integral part of their refinancing strategy.

Key Proceeds and Financial Obligations

The proceeds generated from this offering have been allocated to an escrow account. Upon meeting specific conditions, the obligations tied to these new notes will transition to Mohegan and its other subsidiaries. The anticipated release of these escrowed funds is conditional upon closing a private exchange that involves converting existing unsecured notes into the newly issued secured notes.

Discussions are ongoing with an investor to expedite this exchange, underscoring the authority’s proactive approach to managing its liabilities effectively.

Strengthening Financial Framework

Further strengthening its financial architecture, Mohegan plans to secure a new five-year, $250 million senior secured revolving credit facility involving a consortium of banks. The introduction of this credit line is also crucial for the release of escrowed funds from the initial offering.

Should all conditions be met, the company intends to apply the net proceeds from these offerings towards redeeming its existing 8.000% second priority senior secured notes, due in 2026, while concurrently clearing outstanding loans from the previous revolving credit facility along with related expenses.

Failure to meet the release conditions by May 10, 2025, obligates the Escrow Issuer to redeem the notes, a scenario that the company is diligently trying to avoid.