NagaCorp Faces Small Degree of Refinancing Risk, Says Lucror

Published 7 November 2022, 03:58:12.163 GMT

(Bloomberg) -- Casino operator NagaCorp faces a “small degree of refinancing risk” for its outstanding dollar bond maturing in July of 2024 despite its offer on Friday to buy back up to $120m of the $541.7m note, according to Lucror Analytics.

* “It is uncertain if the company will be able to accumulate sufficient cash to fully repay the bonds at maturity, as NagaCorp’s business is still impacted by COVID-19 related border restrictions in China. As a result, the company may have to tap on bank loans” or seek financing from founder Chen Lip Keong, Leonard Law, a senior credit analyst at Lucror wrote in a note Monday

* NOTE: S&P late last month revised Cambodia-based NagaCorp’s outlook to negative from stable while affirming its rating at B+, saying the 2024 bond could become a risk given troubled credit markets

** Over the past decade, Chen directly and indirectly injected $644m into the company in the form of convertible bonds and new share subscriptions, according to S&P

* S&P said in a note Friday that refinancing risk will remain after the tender

* The bond price was little changed on Monday, indicated at about 85.9 cents on the dollar, according to data compiled by Bloomberg

By Finbarr Flynn