Tabcorp cancels 2020 dividend as part of new debt arrangement
Tabcorp Holdings has informed investors that the company will sanction no dividend in relation to financial-year 2020 trading.
The firm has been forced to terminate the 2020 dividend (fiscal year ending 30 June) as part of its agreed terms with bank lenders, allowing the ASX betting group to waiver approximately AUS $2.2 billion (€1.3bn) of debt covenants until 2021.
Updating investors, Tabcorp stated that new terms were needed on the firm’s ‘syndicated facilities agreement’ in order to preserve working capital helping Tabcorp business units navigate COVID-19 headwinds.
Further financial developments saw Tabcorp enter negotiations with US private placement holders seeking to obtain new covenant terms on a further AUS $2.1 billion tranche of the firm’s debt.
Should Tabcorp secure a further US debt waiver, the ASX company will hold no debt maturity repayments for the remainder of 2020 trading.
New covenant agreements have, said the firm, helped improve corporate liquidity to AUS $820 million (€480m) as of May, compared to $749 million (€440m) available at the start of April.
“We welcome the support of our syndicate banks during this challenging period,” Tabcorp Group CEO David Attenborough said.
“The waivers complement recent actions we have taken to preserve our liquidity and mitigate the financial and earnings impacts of Covid-19.”
Source: SBC News
