Churchill Downs Incorporated (CDI) has announced the amendment of its secured credit agreement to increase the loans encompassed in its existing Term Loan A credit facility by $500m. This credit agreement is due for settlement in 2027.
The amendment increases the existing Term Loan A from $800m to $1.3bn and will make certain other changes to CDI’s pre-existing credit arrangement. The interest rate applicable to borrowings on the Increased Term Loan A will be decided on secure overnight financing rate (SOFR)-based criteria, plus a spread.
The SOFR will be determined by CDI’s total net leverage ratio.
CDI intends to use the net proceeds from the borrowings under the Increased Term Loan A to repay outstanding loans under its existing senior secured revolving credit facility. The credit facility is based on pay-related transaction fees and expenses and is used for general corporate purposes.
CDI recently announced its Q4 2022 results, which showed a record $1.8bn in revenue for the full-year 2022. This figure represented a 13% increase compared to the same prior year period for the company; this would go a long way to explaining why the horseracing company has great credit at the moment.
Its Q4 performance saw revenue rise by 31.6% to generate $480.1m.
Significant Q4 developments for CDI included the acquisition of all the assets of Peninsula Pacific Entertainment LLC, for $2.75bn. There was also the purchase of Chasers Poker Room in Salem, NH, as a means of expanding its historical racing machines (HRMs) to table game environments in the New England market.
