With the loss to South Korea, Mohegan Gaming completes the borrowing.

With the loss to South Korea, Mohegan Gaming completes the borrowing.

With the loss to South Korea, Mohegan Gaming completes the borrowing.

 After having problems in South Korea, the US-based operator has finished a "significant" financial plan that will put off debt payments until 2029.

 The Mohegan Tribal Gaming Authority and a subsidiary, MS Digital Entertainment Holdings, said in a news release last Thursday that they had refinanced $1.2 billion, set up a "new, enlarged" $250 million revolving credit facility, swapped $226 million in 2027 unsecured notes for 2031 secured notes, and agreed to extend some of the 2027 unsecured notes to 2029.

 In a separate deal, the Mohegan tribe bought $100 million in unsecured notes due in 2027 and pushed back the due date to 2032.

 About 60 days after Mohegan lost control of Inspire South Korea because of a lack of cash, the set of deals came together.  When it opened in March 2024, the integrated resort (IR) near Incheon International Airport was Mohegan's first move into the tough Asian gaming market.

 When it opened, the IR had three five-star hotel towers, a music hall with 15,000 seats, large conference rooms, an indoor water park, and a casino that was only open to foreigners.  People called Inspire "the Las Vegas of South Korea" right away, and it almost destroyed the tribe.

 South Korea gets a new leader
 Mohegan had a record-high $1.9 billion in sales and a net loss of $235 million in fiscal year 2024.  It admitted in January that it was facing "an imminent debt covenant violation" that put its ability to stay in business at danger.  It said that ramp-up costs in South Korea and low table hold at Inspire's casino were to blame for the gap.

 The Uncasville, Connecticut operator wanted to change the covenants to make them more in line with market standards because they couldn't pay off their $275 million debt.

 But the main backer, Bain Capital, would not give in.  The Boston-based investment company used an acceleration clause to tell Mohegan that he had to pay up right away or give up control of Inspire.  Bain used its right to take over the IR on Yeongjong Island on February 19.

 Bain told everyone involved that the change of command would not affect how things were run for workers or guests.  Chen Si, head of Inspire, said that the resort would be running as usual now that a "bullish" new owner was in charge.

 A fresh start for Mohegan
 The company no longer has to pay back debts until 2029, so its chief finance officer Ari Glazer said it can "reduce leverage, improve borrowing costs, and create greater strategic flexibility."

 The cleaning up was seen as "a clear demonstration of our unwavering commitment to the success of Mohegan" by James Gessner Jr., chairman of the tribe.

 Gessner also said that the operator now has "extended maturity runway and financial flexibility."  The change "strengthens our alignment with investors as we put capital back into the business."