Melco Crown raising P5.5B to fund casino project

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Melco Crown raising P5.5B to fund casino project
The company is selling shares through a top-up offer to fund the increase in budget for its casino project in Entertainment City

MANILA, Philippines – Melco Crown (Philippines) Resorts Corporation is raising P5.48 billion ($124.5 million) through a top-up offering to finance additional spending for its integrated resort and casino project within the government-sponsored Entertainment City.

In a disclosure to the Philippine Stock Exchange on Thursday, June 19, Melco Crown said it would sell 485.177 million shares to investors for P11.30 apiece.

The offer price represents a 7.2% discount to the stock’s last traded price of P12.18 per share. It is also the lower end of the company’s indicative price range of P11.30 to P11.70.

Melco Crown’s majority shareholder MCE Investments agreed to sell said shares after which it will also subscribe to the same number of shares at the same price.

Deutsche Bank AG and UBS AG will handle the transaction.

“The transaction allows the corporation to raise capital in a most expeditious and efficient manner with the least cost in order to fund its capital expenditures for the completion of City of Drams Manila, the integrated hotel, gaming, retail and entertainment resort project in the Bagong Nayong Pilipino-Entertainment City complex,” it said.

The top-up offer, which is expected to close by June 24, will widen Melco Crown’s public float to 31.17% from current 23.62%.

Ahead of the announcement, trading of Melco Crown shares was suspended on Wednesday, June 18, and lifted Thursday.

Higher budget for casino

Melco Crown increased the budget for its integrated resort and casino project, City of Dreams Manila, to P37 billion from P28 billion.

The project will have 6 hotel towers, with VIP and luxury boutique rooms; numerous specialty restaurants and bars; gaming facilities; a multi-level car park; and 3 separate entertainment venues.

City of Dreams, set to open in the fourth quarter of 2014, will be the second casino project to operate in Entertainment City. – Rappler.com

Casino image from Shutterstock

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