Live Nation Announces Closing Of $1.2B Notes: 'Extra Cushion To Withstand Any Scenario Into 2021'

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Live Nation Entertainment today announced the completion of its previously announced offering of $1.2 billion in aggregate principal amount of 6.5% senior secured notes due 2027.

A press release says that due to overwhelming investor demand, the offering was upsized from $800 million.

“This added liquidity will help bolster our already strong balance sheet, providing us with extra cushion to withstand any scenario well into 2021, as well as ample resources to capitalize on current innovations and ramp business up quickly when the time is right,” stated Michael Rapino, President and Chief Executive Officer of Live Nation Entertainment.

“Artists’ endless creativity along with the enduring fan demand for concerts fuels our confidence that there is, and always will be, a strong future ahead for concerts and live events.”

The statement says that as of March 31, 2020, Live Nation’s total cash and cash equivalents balance was $3.3 billion, which included $817 million of free cash and $2.0 billion of event-related deferred revenue. The company has available debt capacity of $963 million from its revolving credit facilities and undrawn term loan A. The addition of this $1.2 billion in proceeds from these new notes gives the company sufficient liquidity while preserving the existing available debt capacity.

At market open on Monday, LYV’s stock price had jumped to $46.75 per share, a jump of more than 4% on a day that saw the major indexes up, including 1.5% for the broad-market S&P 500.

Live Nation’s 1Q earnings release from early May reported a loss of $184.8 million for the first quarter of 2020 in the company’s first since the coronavirus pandemic began.

“First and foremost, we will let the facts and science tell us when we should start putting on concerts again,” Rapino said in the earnings release. “We are working with the government at the federal and state levels in the U.S. and across all countries, building plans that fit within reopening phases for each specific market. In the meantime, we have fortified our balance sheet to have the resources to ramp up quickly when the time is right.”