SJM Holdings Buys 34% of Outstanding US$500M Notes as Part of Broad Debt Strategy

Macau gaming operator SJM Holdings Ltd has begun a targeted repurchase of its US$500 million senior notes due on 27 January 2026, with filings showing the company has acquired approximately 34 % of the outstanding principal as part of a broader refinancing and debt-management strategy. The senior notes carry a fixed interest rate of 4.500 per cent and were originally issued in January 2021. SJM’s move reflects balancing near-term obligations while pursuing financial flexibility in a competitive market backdrop.

The tender offer allows holders to sell their notes back to SJM for US$1,000 per US$1,000 of principal, and the settlement of successfully tendered notes is expected around mid-January. To fund these repurchases, SJM plans to use a combination of internal cash resources and proceeds from new debt offerings. This dual approach not only reduces immediate liabilities but also redistributes the company’s debt maturities, extending its overall financial runway.

In tandem with the buyback, SJM Holdings has announced the issuance of new senior unsecured U.S.-dollar notes totalling US$540 million with a 6.5 per cent interest rate and maturity in 2031, aimed at refinancing existing loans and strengthening liquidity. The new notes are planned to be listed on the Hong Kong Stock Exchange, with payments due semi-annually. The initiative is designed to extend SJM’s debt profile and enhance its long-term financial flexibility, addressing investor concerns about leverage and credit metrics amid ongoing Macau market challenges.

Credit rating agencies have highlighted the steep leverage relative to earnings as a significant factor for SJM’s debt outlook, maintaining a below-investment-grade stance on the proposed new notes issuance and noting the company’s need to improve deleveraging over time. Analysts also point to slower-than-expected mass market performance at key properties like Grand Lisboa Palace and the broader competitive pressures in Macau’s gaming sector as risks that could affect SJM’s financial trajectory.