GTECH agrees $2.6bn financing as shareholders approve IGT deal

5th November 2014 9:40 am GMT

Gaming and lottery supplier GTECH has entered into a $2.6bn senior facilities agreement with a syndicate of twenty banks, as the company’s shareholders approved its takeover of US gaming supplier International Game Technology (IGT).

GTECH and its wholly-owned subsidiary GTECH Corporation entered into the senior facilities agreement with a syndicate of banks led by J.P Morgan Limited and Mediobanca Banca di Credito Finanziario as global coordinators, bookrunners and mandated lead arrangers.

The Royal Bank of Scotland is acting as agent and KeyBank National Association is acting as swingline agent.

The agreement provides for a $1.4bn multicurrency revolving credit facility for GTECH Corporation and a €850m multicurrency revolving credit facility for GTECH S.p.A.

Georgia Worldwide, the newly formed company that will combine GTECH and IGT, will be able to borrow under both facilities.

Following the completion of the IGT acquisition, the US Dollar facility will be increased to $1.5bn and IGT will be able to borrow under the US Dollar facility. The revolving credit facilities were increased from the $2.0bn initially requested because of a large oversubscription.

The revolving credit facilities will be used for general corporate purposes, including repayment of any outstanding amounts under the term and multicurrency revolving credit facilities for GTECH S.p.A and GTECH Corporation (which are scheduled to expire in December 2015) and refinancing certain debt securities issued by GTECH S.p.A.

Upon completion of the IGT acquisition, the US Dollar facility will also be used to repay any outstanding amounts under IGT's revolving credit facility.

Meanwhile at an extraordinary shareholders’ meeting yesterday, GTECH shareholders approved the cross-border merger of GTECH S.p.A into its Georgia Worldwide subsidiary organised under the laws of England and Wales.

The merger is part of a broader transaction which will see GTECH acquire IGT. Upon completion of the deal, Georgia Worldwide will become the parent holding company for the combined operations of GTECH and IGT, with its registered office in London and operating headquarters in Rome, Las Vegas, and Providence.

The company’s ordinary shares will be listed on the New York Stock Exchange, with GTECH and IGT shares being delisted from Milan and New York respectively.

Shareholders representing approximately 71 per cent of GTECH attended the meeting in Rome on Tuesday. Shareholders who did not vote in favour will be entitled to exercise their statutory right of withdrawal (diritto di recesso) within 15 days after the registration of the resolution with the Companies’ Register of Rome.

The liquidation value per GTECH share to be paid to shareholders validly exercising the statutory right of withdrawal is equal to €19.174 per share. The acquisition will not be completed if more than 20 per cent of GTECH shareholders exercise their right of withdrawal.

Shares in GTECH S.p.A (Co. Data) (MIL:GTK) were trading down 1.27 per cent to €17.95 per share in Milan following the announcement.

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