Genting Malaysia to inject RM625mil into Empire

In its filing with Bursa Malaysia, GenM said its indirect wholly owned subsidiary, Genting ER II LLC (GER II), a Delaware company, had entered into a subscription agreement to subscribe for up to US$150mil (RM625mil) of additional Series L preferred stock of Empire. The proceeds from the Series L will be utilised by Empire to facilitate its long-term financing plan, GenM said.

PETALING JAYA: Genting Malaysia Bhd (GenM) is injecting fresh funds of up to US$150mil (RM625mil) into its United States gaming unit Empire Resorts Inc.

In its filing with Bursa Malaysia, GenM said its indirect wholly owned subsidiary, Genting ER II LLC (GER II), a Delaware company, had entered into a subscription agreement to subscribe for up to US$150mil (RM625mil) of additional Series L preferred stock of Empire.

The proceeds from the Series L will be utilised by Empire to facilitate its long-term financing plan, GenM said.

It noted that with the latest proposed equity injection, GenM would have invested a total of up to US$524.4mil (RM2.18bil) in Empire.

“In financial year 2020 (FY20), the US gaming industry was severely impacted by the temporary closures amid regional lockdowns for approximately five months from mid-March to September 2020,” GenM said.

“The disruption to Empire’s operations caused by the pandemic impacted its long-term-financing plan in FY20.

“Despite poor market conditions, with the financial support from GenM, Empire raised US$365mil (RM1.52bil) for working capital and to refinance its debts totalling US$350mil (RM1.46bil) in March 2021,” it added.

GenM pointed out that Empire was contemplating a long-term financing plan, of which the proceeds would be utilised to partly repay existing indebtedness of US$365mil (RM1.52bil) and financing related expenses.

GenM said the proposed equity injection into Empire would be funded through proceeds from GenM’s US$1bil (RM4.16bil) bond issuance completed on April 20, 2021.

GenM indirectly owns 49% of common stock in Empire, through its indirect wholly-owned subsidiary, Genting ER Limited (GER).

GenM also indirectly owns 100% of the Series G and Series L in Empire through GER II and 49% of the Series H convertible preferred stock in Empire through Genting Empire Resorts LLC.