Melco-PBL Entertainment, the casino development joint venture between Stanley Ho Hung-sun's Melco International Development and Australia's Publishing and Broadcasting Ltd (PBL), announced yesterday it had secured a $1.28 billion syndicated loan from a consortium led by Macau banks to fund construction of the $1.5 billion, 227-room Crown Macau hotel and casino on Taipa Island.
The deal is the latest in a string of debt financing issues for Macau casino projects, many of which are being bankrolled by local lenders.
'Macau is one of the hottest debt markets in Asia,' Societe Generale Asia managing director Ashley Wilkins told an investors' conference in the territory yesterday.
But he cautioned that 'irrational exuberance [is] alive and well' in some of the deals that had taken place over the past year.
The term of the Melco-PBL loan is seven years and its interest rate of Hong Kong interbank offered rate plus 2.2 percentage points is among the lowest of recent deals.
Banco Nacional Ultramarino and Bank of China (Macau) have each committed $450 million, with Banco Comercial de Macau, ICBC (Asia), Banco Espirito Santo do Oriente (Macau) and Liu Chong Hing Bank (Macau) making up the balance.