Wynn Announces Sale Of 6.32 Million Shares

By Ben Hamill - February 13 2021
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Wynn Announces Sale Of 6.32 Million Shares

Casino giant Wynn Resorts is taking full advantage of a recent hike in the value of its shares. The operator announced earlier this week that it plans to offload up to 6.32 million shares in an attempt to boost its cashflow.

The decision to sell comes after the value of casino group’s shares increased by more than 17 percent late last week, and with the Wynn brand hovering at just 15 percent below its average fifty-two week annual high. This particular performance is something the group last witnessed before the onset of the global health crisis, which saw Wynn having to temporarily close the doors to its two Macau-based integrated resorts in Feb. last year.

Since the price of an ordinary Wynn share closed at just under $117 late last week, the company stands to raise at least $740 million in the event that it does end up offloading all 6.32 million of the available share assets. The sale of the shares is reportedly being overseen by the Bank of America, Goldman Sachs, and Deutsche Bank’s securities division.

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Debt-Free Issue Is Good News

Refreshing about Wynn’s terms of offer is that the casino group has decided not to issue debt, and as a result, since no actual liabilities are being created, the process is basically all good  news for investors.

Potentially significant about the timing of Wynn’s announcement is the overlap with the4 upcoming gaming licence renewal process set to take place in Macau. Analysts are now speculating over whether some of the disposable cash raised by the sale might be put towards the group’s operations in the region.

Crunching The Numbers

Wynn’s big offload represents an increase of 1 million shares of common stock. The group has granted underwriters a period equal to a standard 30-day option to purchase additional shares – and up to a maximum cap of 975,000. The offering is anticipated to close on Feb. 11, 2021, subject of course to the usual conditions of closing.

Significant to investors is that a shelf registration statement had previously been filed with the Securities and Exchange Commission. The statement, which relates to the shares now on offer, was filed on Nov. 6, 2019. This alludes to the fact that the group had been closely tracking the value of its shares ever since – and most probably for the explicit purpose of selling up. Even so, it isn’t at all unusual for companies to raise capital by selling rallying shares.

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