Asian casino operator, Melco International Development Limited, has announced the imminent launch of an initial public offering (IPO) on the New York Stock Exchange for its Studio City International Holdings Limited subsidiary.
Paying down debts:
The Hong Kong-listed firm used a Wednesday filing (pdf) to reveal that it hopes the action involving some 28.75 million shares will bring in between $301.88 million and $359.38 million that its subordinate subsequently plans to use in order to ‘acquire newly-issued shares’ in its own MSC Cotai Limited subsidiary and consequently repay ‘certain existing indebtedness.’
Firm to remain as majority shareholder:
Studio City International Holdings Limited is the enterprise behind the Hollywood-themed Studio City Macau integrated casino resort in the Cotai Strip neighborhood of Macau, which opened in 2015 at a cost of about $3.2 billion, with Melco International Development Limited due to remain as its majority shareholder post-listing via its Melco Resorts and Entertainment Limited vehicle.
The filing from Melco International Development Limited explained that it currently owns around 60% of Studio City International Holdings Limited with the remaining interest controlled by New Cotai Holdings LLC, which is an entity controlled by American investment firms Oaktree Capital Management LP and Silver Point Capital LP. Following the successful completion of the IPO, it declared that the pair intends to hold ‘approximately 88.9%’ of the newly-issued shares and remain as the ‘majority shareholder’ of the floated concern.
Melco International Development Limited’s filing read…
“The company’s indirect interest in Melco Resorts [and Entertainment Limited] will not be affected by the global offering and the company will remain as Melco Resorts [and Entertainment Limited’s] majority shareholder.”
Latest American listing:
Melco Resorts and Entertainment Limited is already listed in the United States via the Nasdaq bourse while Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Incorporated and Morgan Stanley and Company International are serving as the book-runners and representatives for the Studio City International Holdings Limited float.
Float awaits approval:
The filing from Melco stated that the IPO will only begin once the New York Stock Exchange grants its approval and the United States Securities and Exchange Commission regulator declares ‘effective’ the revised registration statement submitted by Studio City.
Should either these not happen, the firm proclaimed that it will cancel ‘the proposed distribution in specie’, which would see it pay current investors around 1.5% of the float’s gross proceeds. It detailed that this amount is expected to range from $4.53 million to $5.39 million before announcing that ‘the details of the proposed distribution in specie have not yet been finalized.’