Wynn Resorts (NASDAQ: WYNN) disclosed on Tuesday that it has sold $800 million in corporate debt through a private placement to redeem bonds that mature in 2025 and to cover a $130.13 million fine imposed by the Department of Justice (DOJ). 

The recently released senior notes are set to mature in 2033 with a 6.25% interest rate and are “backed by all domestic subsidiaries of Wynn Resorts Finance” excluding Wynn Resorts Capital.

"Wynn Las Vegas, LLC will use the amounts to (i) redeem in full Wynn Las Vegas and Wynn Las Vegas Capital Corp.’s 5.500% Senior Notes due 2025 (the “2025 LV Notes”) and (ii) pay fees and expenses related to the redemption and (b) use the remainder of the net proceeds for general corporate purposes, which may include covering all or a portion of the $130 million forfeiture under the non-prosecution agreement described in our Current Report on Form 8-K filed with the Securities and Exchange Commission on September 6, 2024,” according to a statement issued by the gaming company.

Last Friday, Wynn informed investors that it had agreed to a $130.13 million settlement with the Justice Department — the largest penalty ever imposed on a single domestic casino — “based on admissions of criminal misconduct," as stated by the DOJ. 

Wynn Bond Offering Suggests Quick Settlement of DOJ Fine 

Although the gaming company did not specify when it will settle the $130.13 million debt owed to the government, mentioning that certain funds from the bond sale might be allocated for that purpose suggests the casino operator could quickly address that obligation. 

An investigation conducted by the DEA, IRS, and the investigative division of the Department of Homeland Security revealed that Wynn Las Vegas breached several anti-money laundering regulations and intentionally permitted certain disreputable Chinese clients to visit and gamble at the integrated resort on the Strip. 

In a case emphasized by the DOJ, Wynn Las Vegas allowed a Chinese customer who “had spent six years incarcerated in China for engaging in unauthorized international monetary transactions and breaching other financial regulations” to gamble at the venue. 

Under a nonprosecution agreement (NPA) with the government, Wynn Las Vegas admitted to misconduct and stated that it has implemented significant measures to enhance its anti-money laundering protocols, while informing the government that employees associated with the dubious transactions are no longer with the company. 

Wynn Bond Sale Has an Additional Function 

Although the Wynn bond sale aims to swiftly remove the DOJ liability from its balance sheet, this transaction is significant as it enables the operator to pay off bonds maturing next year. 

Wynn collaborates with competitor MGM Resorts International (NYSE: MGM) by recently unveiling new debt offerings designed to address challenges maturing next year. Prior to those announcements, some analysts remarked that such transactions weren't needed since gaming firms can manage the obligations due in 2025. 

In different but connected news, gaming device and lottery powerhouse International Game Technology (NYSE: IGT) announced on Tuesday that it is launching a new euro-denominated bond offering to pay off nearly $500 million in senior secured notes due in 2025.