(Bloomberg) -- One of Canada’s biggest gaming companies is seeking as much as C$1.8 billion ($1.3 billion) of private debt to refinance loans and pay owners a dividend, in what would be one of the country’s biggest such deals this year.
Gateway Casinos & Entertainment Ltd. is working with Morgan Stanley on the outreach to lenders, according to people with knowledge of the matter who asked not to be identified as the talks are private. Conversations are preliminary and details — including the size — of a deal may change, they said.
Gateway is majority owned by Newton Glassman’s Catalyst Capital Group Inc. Representatives for both firms did not reply to requests for comments while Morgan Stanley declined to comment.
The $1.7 trillion private credit market is in a pitched battle with broadly syndicated markets to provide deal financing. Issuance in the US leveraged loan market this year set a record on Thursday, with activity driven by loan repricings and debt refinancings.
That means direct lenders are looking for other type of borrowers, sometimes leaning into riskier type of credits or offering more-creative solutions. Pure Fishing Inc. recently clinched a $750 million private-credit deal, Bloomberg News reported, and Spandex maker Lycra Co. is sounding out investors on a private debt transaction.
Gateway peer Great Canadian Gaming Corp., backed by Apollo Global Management Inc., on Wednesday launched a $665 million term loan in the US leveraged loan market to refinance debt.
Catalyst has owned Gateway — which has 31 properties — since 2009. Last year, the company hired advisers as it was considering a sale or other strategic options, Bloomberg News reported at the time.
(Adds deals in the fifth paragraph. An earlier version of this story incorrectly stated the private credit market’s size.)
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