Deutsche Bank, Goldman Sachs and Lehman Brothers are launching syndication of a credit facility for Penn National Gaming on May 3 to fund the company's merger with Argosy Gaming Co. Penn agreed to acquire all of the outstanding shares of Argosy in November for $2.2 billion, but the deal has been delayed due to a Federal Trade Commission review.
The facility consists of a five-year, $750 million revolver; a six-year, $325 million "A" term loan; and a seven-year, $1.65 billion term loan "B." Last December the three banks went out to managing agents and Calyon, Wells Fargo Bank and Bank of Scotland signed on at the agent level, taking $300 million tickets (LMW, 12/10). Pricing has not yet been announced, but was expected to be LIBOR plus 2 3/8% on the pro rata and LIBOR plus 2 1/2% on the "B" loan.
Wyomissing, Pa-based Penn National owns and operates casino and horse racing facilities with a focus on slot machines in eight states and Canada. Based in Alton, Ill., Argosy has five casinos. Calls to William Clifford, cfo, were referred to a spokesman who did not return a call.