Goldman Sachs' $250 million "B" tranche for Venetian Casinos was allocated late last week, with bankers and buysiders expecting pieces to be on the skinny side. The deal was more than five times oversubscribed, according to bankers, and instead of being upsized, pricing was slashed 1/2% to LIBOR plus 3%. The deal also includes a $125 million pro rata piece, which has a $50 million delayed draw term loan. Bankers said it is not too surprising the credit was so oversubscribed. Despite concern over Vegas-based hotels, Venetian is a solid operation, said bankers and analysts.
The proceeds from the new credit and the notes will repay existing debt and also fund a building project that was put on hold following Sept 11. According to Moody's Investors Service the project has a good risk/reward profile, and though cash flow results have not returned to pre Sept. 11 levels, improved travel trends combined with cost cutting support the credit. Officials at Goldman declined comment.