Casino operator Twin River Worldwide Holdings raised $125 million in new debt Tuesday, a sum which could be used in its upcoming casino purchases or in funding additional transactions.
In conjunction with the debt raise, the Rhode Island-based company said it expects to report between $100 million to $130 million in net revenues for the third quarter, which ended on Sept. 30, with cash flow between $30 million and $40 million.
The regional casino company said it expects to be cash-flow positive for the quarter, excluding results from the acquisition of two casinos from the former Eldorado Resorts. Twin River said it ended the quarter with liquidity in excess of $360 million.
“We think preliminary third-quarter results show Twin River benefiting from resilient regional trends,” Truist Securities gaming analyst Barry Jonas told investors in a research note following the announcement. “Meanwhile, we continue to see a compelling M&A roll-up strategy playing out, with management acting opportunistically to pre-fund pending acquisitions.”
Twin River announced last week it was acquiring Jumer’s Casino & Hotel in Rock Island, Illinois for $120 million in an all-cash deal. The company has two other pending transactions involving Caesars Entertainment – the purchase of Bally’s Atlantic City, for a reported $25 million, and the combined purchase of Eldorado Shreveport in Louisiana and the operations of MontBleu Resort Casino in Lake Tahoe, Nevada for $155 million.
When the deals are finalized, Twin River will operate 13 casinos in nine states.
Earlier this year, Twin River acquired Casino Vicksburg (formerly Lady Luck Casino Vicksburg) in Mississippi and Casino KC (formerly Isle of Capri Casino) in Kansas City, Missouri, from Caesars’ predecessor company, Eldorado, for $230 million.
At the end of June, Twin River had $972 million of long-term debt. The $125 million raised Tuesday will be included with $400 million of debt that will all come due in 2027.
The company said the proceeds would be used for general corporate purposes, funding the company’s operations, acquisitions, and other transactions.
Twin River management did not have any comment in conjunction with the debt raise.
Jonas said the company has visions of $500 million in annual cash flow.
“Moving forward, we expect management to continue to evaluate additional (merger and acquisition) opportunities,” he said.
Shares of Twin River, traded on the New York Stock Exchange, closed at $25.48 Tuesday, down $1.25 or 4.68%.
Howard Stutz is the executive editor of CDC Gaming. He can be reached at hstutz@cdcgaming.com. Follow @howardstutz on Twitter.
