Fertitta Entertainment to raise $3.7bn through private offering

Fertitta Entertainment LLC announced on January 10 that it will be launching a private offering of $3.7bn in senior notes, with the resulting capital to be put toward refinancing a portion of its existing debt.

Of the proposed $3.7bn, $1.85bn will be allocated toward senior notes due in 2029, with the remaining $1.85bn comprising senior notes due in 2030. The proposed offering is subject to market and other conditions.

The gross proceeds of the offering will be used to refinance approximately $4.6bn of existing debt on the company’s balance sheet. That includes current senior notes due in 2024 at 6.75% and 2025 at 8.75%, in addition to redemption premiums and accrued and unpaid interest.

Fertitta Entertainment owns and operates scores of gaming, restaurant, hospitality, and entertainment interests throughout the country, including the Golden Nugget casino properties in Nevada and New Jersey, as well as restaurant chains such as Del Frisco’s, Bubba Gump Shrimp Co., and Rainforest Cafe.

Tillman Fertitta is also the majority shareholder in Golden Nugget Online Gaming (GNOG), which is set to be acquired by DraftKings in a deal likely to complete later this year.

When the COVID-19 pandemic hit in early 2020, Fertitta had to cease the majority of his company’s business operations. Over the past year, however, the gaming and hospitality industry has returned in full force thanks in part to pent-up demand and extra money in the pockets of consumers.

The announcement of this private offering comes on the heels of Fertitta Entertainment scrapping an $8.6bn deal to go public via a special-purpose acquisition company (SPAC) in December.

Earlier this month, Fertitta and GNOG’s board of directors were named in two high-profile lawsuits brought by shareholders in GNOG concerning alleged impropriety in the run up to the sale to DraftKings.

Allegations include misleading shareholders and making deals which were not in the interests of shareholders.