SJM Holdings' $540M Senior Notes Issuance at 6.5% Interest

Macau's prominent casino operator, SJM Holdings Ltd, is poised to embark on a noteworthy financial venture with the issuance of senior unsecured notes. As per an announcement on Friday, the company is set to release a gross total of US$540 million in notes. These notes come with an attractive annual interest rate of 6.500 percent and are scheduled for maturity in 2031, according to a filing presented to the Hong Kong stock exchange.

The issuance of these notes will be handled through SJM International Ltd, a wholly-owned subsidiary of SJM Holdings. The primary aim of this initiative is to "extend the maturity profile of the group’s indebtedness and enhance the group’s financial flexibility," as articulated by SJM Holdings in their statement. This financial strategy represents a significant step in managing the financial health and operations of the casino empire.

Listing and Subscription Details

SJM Holdings has divulged plans to list these U.S. dollar-denominated notes on the Hong Kong Stock Exchange. To facilitate this, the company has secured an eligibility letter, bolstering their listing plans. Interest on these notes is scheduled to be disbursed bi-annually in arrears, specifically on January 15 and July 15 each year.

Furthermore, it was revealed in the Friday document that Sociedade de Turismo e Diversões de Macau SA (STDM), a subsidiary of the overarching parent of SJM Holdings, has committed to subscribing to an unspecified portion of these new notes. STDM holds a controlling stake in SJM Holdings. The board of SJM Holdings estimates this "connected subscription" is based on "normal commercial terms or better." The commercial terms, notably the interest rate, were determined after "arm’s-length negotiation between the company and the connected subscriber."

Notably, these notes are not to be secured against any assets held by the company, which means the connected subscription maintains full exemption from Hong Kong listing rules related to disclosure, annual review, circular, and shareholders’ approval requirements.

Credit Ratings and Debt Strategy

Ahead of public announcements regarding the pricing, credit rating agencies Fitch Ratings Inc and Moody’s Ratings have each assigned a below-investment grade rating to this new U.S. dollar-denominated issuance. Both agencies have noted the challenges of deleveraging that SJM Holdings faces. Moody’s has further indicated that an improvement in SJM Holdings' rating is "unlikely at present."

In tandem with the issuance of the new notes, SJM Holdings is engaging in a repurchase exercise, offering cash to buy back its existing 4.500-percent senior notes due on January 27 of this year. The funding for this particular repurchase will be sourced from the company’s internal reserves, as well as the proceeds from the issuance of the newly minted U.S.-dollar-denominated senior notes.

By implementing these strategic financial maneuvers, SJM Holdings aims to restructure its debt and secure its financial footing moving forward.

Source: SJM announces US$540mln in senior notes priced at 6.5pct with a 2031 maturity, GGRAsia, January 9, 2026.

Posted by Wizard
Jan 12 2026