Mashantuckets set to default on loan payment
About $7 million in interest still owed.
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By WILLIAM SOKOLIC
For The Norwich Bulletin
Posted Nov 16, 2009 @ 11:37 PM
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.The Mashantucket Pequot Tribal Nation was unable to meet the full semi-annual interest payment due Monday on a $500 million 8.5 percent note, and is unlikely to pay the balance within the 30-day grace period, which ends Dec. 16.
As a result, the tribe would go into default.
The trustee for the tribe paid approximately $14.2 million of the $21.25 million on notes due in 2015.
“The tribe does not currently anticipate the remaining amounts due will be paid within the grace period,” the tribe said in a prepared statement.
As announced on Oct. 26, the tribe entered into a forbearance agreement with its senior lenders that extends through Jan. 20, 2010.
Saddled with debt and suffering the impact of the recession, the Mashantuckets are negotiating to restructure more than $2 billion in debt.
The tribe said the restructuring efforts will not affect guests, employees, suppliers or business partners at Foxwoods or MGM Grand at Foxwoods.
The debt burden won’t affect casino hotel operations, said analyst Roger Gros of Global Gaming Magazine.
“Eventually they’ll refinance for a longer term or higher interest,” he said. “The tribe has deep pockets, so it’s not a big problem.”
EDITORIAL FOOTNOTE: Could this happen to the Mohegans? Is the financial problems facing the Mohegans going to cause the same kind of situation? What do you think?
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