Still in the midst of a global pandemic and after months of uncertainty due to event restrictions worldwide, Live Nation Entertainment has revealed plans to boost its liquidity by an additional $500 million.<\/p>\n
The $500m will be raised via a secured note sale according to a release published on December 17, with repayment due in 2028. The debt carries<\/a> an annual interest rate of 3.75% per annum, reports the Los Angeles Business Journal.<\/em><\/a><\/p>\n The notes and the related note guarantees will be offered through a private placement.<\/p>\n The $500m raise follows Live Nation’s $1.2 billion raised in May 2020<\/a> via a secured note sale, which President and Chief Executive Officer Michael Rapino stated at the time would provide \u201cextra cushion to withstand any scenario well into 2021\u201d.<\/p>\n That debt is due to be repaid by 2027 and carries an annual interest rate of 6.5% per annum.<\/p>\n In Q3 2020 \u2013 i.e. the period ended September 30 \u2013 Live Nation generated<\/a> revenues of\u00a0$184 million, marking a\u00a095%\u00a0year-over-year decline compared with the\u00a0$3.77 billion\u00a0it generated in Q3 2019 from concerts, ticketing and sponsorship.<\/p>\n At the end of the Q3 2020, Live Nation had total cash and cash equivalents of\u00a0$2.6bn<\/span>, which included $951m<\/span>\u00a0of free cash.<\/p>\n At the time, this free cash, along with $963m<\/span> of available debt capacity, provided the company with over\u00a0$1.9bn<\/span>\u00a0in available liquidity.<\/p>\n Live Nation\u00a0told investors<\/a>\u00a0that it \u201cbelieves this level of liquidity provides it with the ability to fund operations until the expected return of concerts at scale in the summer of 2021, preceded by ticket sales earlier in the year.\u201d<\/p>\n According to Live Nation’s statement announcing this latest raise,\u00a0 the company intends to use the proceeds to repay $75m of an existing “senior secured term loan B facility”.<\/p>\n It will also be used to pay for general corporate purposes, including undisclosed “acquisitions and organic investment opportunities”, and to pay fees and expenses related to the offering.<\/p>\n
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