The operator of two casinos in Macau, two on the Las Vegas Strip and one in Pennsylvania has been working to improve its liquidity and de-lever its balance sheet in the aftermath of the recession and broken credit markets, which had it on the brink of loan defaults. The filing for the IPO, which some analysts have speculated could raise $1 billion to $2 billion and which Wynn Resorts is also considering, isn't the only inroad the company is building.

Earlier this month, the company announced a deal with Bank of Nova Scotia whereby it is now allowed to sell as much as a 49.9% stake in its Macau operations--as long as a healthy chunk of the net proceeds are used to pay down its subsidiaries' $3.3-billion credit facility with the bank. The allowance, from not being allowed to sell any stake in the operations, was part of an amended credit agreement that gives Sands a six-quarter breather from some of the requirements of its debt agreements.

The amended credit agreement also allows for Venetian Macau Limited and its subsidiaries to issue up to $1 billion of senior secured notes ranking pari passu with the loans outstanding under the credit agreement, and for the issuance of an additional $500 million of senior unsecured notes or senior secured notes ranking junior to the current outstanding loans as long as the consolidated leverage ratio is not greater than 3.0X. In exchange, Sands' applicable interest rate margins for all classes of loans outstanding under the credit agreement increase by 3.25% per annum, until an amount equal to $500 million has been applied to prepay the loans under the Credit Agreement, and by 2.25% per annum after such prepayment from the applicable interest rate margins that were in place immediately prior.

Shares of Las Vegas Sands were trading at $13.99 during the noon-hour on Friday, up $0.80 on the day and up $1.24 from Wednesday's close of $12.75.

Instant Insights /

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