Wynn Resorts Gets $1.5 Billion Credit Line With Macau Pressured

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Wynn Resorts Ltd. obtained a $1.5 billion credit line from Bank of China Ltd., with casino stocks under pressure amid concerns over increased government oversight in Macau and the outlook for the world’s biggest gambling hub.

The agreement also allows Wynn to borrow an additional $1 billion under certain conditions, according to a filing. Wynn said the funds will be used to refinance debt at Wynn Macau and its subsidiaries, as well as to pay for “ongoing working capital needs and for general corporate purposes.”

Macau authorities on Tuesday laid out plans to tighten restrictions on operators, including appointing government representatives to “supervise” companies in the Chinese enclave. That triggered a cratering of stock prices, with Macau’s top gaming companies losing a record $18.4 billion in market value on Wednesday. 

Shares in Wynn Macau lost a further 4.7% in Hong Kong on Thursday, after its 29% plunge the previous day.

Read more: Macau Casinos See $18 Billion Wipeout as China Tightens Grip

Officials in Macau, the only place in China where gambling is legal, said they would begin a 45-day public consultation period on Sept. 15 to discuss the legal revisions. Among the topics being covered: how many licenses -- known locally as “concessions” -- will be allowed, how long their terms will be, and the level of supervision by the government. 

The lending agreement binds Wynn to “certain mandatory prepayment provisions” if Wynn Macau’s gaming operations are terminated.

©2021 Bloomberg L.P.

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