Tuesday October 29,2014 : SCIENTIFIC GAMES' TAKEOVER OF BALLY COULD BE IN TROUBLE
Major banks delay $3.19 billion backing.
The proposed acquisition of Bally Technologies by Scientific Games could be in trouble following reports Monday that JPMorgan Chase & Co. put off syndicating $3.19 billion of loans to help finance the purchase.
The news that JPMorgan, Bank of America Corp. and Deutsche Bank AG – hired by SG to sell the bridge loan – had failed to generate the necessary interest from investors by the October 3 deadline caused a drop of over 7 percent in the Scientific Games share price.
However, the banks reported a fall-back position, revealing that they have already successfully marketed about $2 billion in separate loans backing the acquisition.
Bloomberg business news observed that marketing the loans was hampered as yields on junk debt rose to their highest levels in a year.
In August this year Scientific Games announced its agreement to acquire all of the outstanding Bally common stock for $83.30 in cash per share for a total of $5.1 billion