Software Developer Light & Wonder Retools for the Future

The online casino software development community has become very competitive over the past few years. That's largely attributable to the increase in participants and he elevation of small to mid-size developers that aspire to grab a larger market share. Software developer Light & Wonder can be included in the latter group.

Light & Wonder Inc., formerly known as Scientific Games, is an American-based online casino software developer that is currently traded on the NASDAQ under the symbol LNW. Headquartered in Las Vegas, Nevada, the company originally started under the name Autotote (founded in 1973), a supplier of totalizator systems for the horse racing industry. Under the name of Scientific Games, they got involved with the development of retail slot machines and online casino video slots.

The company has announced the issuance of $1.0 billion USD in unsecured notes in a private offering through its Light & Wonder International Inc. subsidiary (LNWI). Other LNW subsidiaries include Barquesrt, Bally Technologies, WMS Industries, and NYX Gaming Group Limited.

Details of the Offering

The issuance of the unsecured note was driven by the company's desire to retool for the future, hoping to be more competitive as it strives to claim more market share. In a press release, LNWI representatives stated the funds are intended to be used as follows:

• Repay all current outstanding debt


• Redeem $700 thousand in previously issued notes (principal, fees, and interest)


• General fund to be used for corporate purposes
  

While the effective interest rate on the new unsecured notes was not disclosed, the maturity date of said notes has been set for 2033. The rate is assumed to be attractive given the offering's status as "unsecured" notes. As senior notes, payment of these notes will get priority over all other debt in case the company is forced to file for bankruptcy at a future date. It's worth noting that the company is currently in good standing.

Since the notes are registered under the Securities Act of 1933, they will not be available for purchase by U.S.-based investors.

Market and Investor Reaction

This move shines a bright light on the future of the company. Some of he funds are expected to be used on the research and development of new online casino content. That should help the company be more competitive in an industry that continues to grow at an impressive rate.

The market and investors are expected to see this as a positive move for two reasons. First, it serves as an indication that the company holds market confidence, as indicated by its ability to secure this level of corporate financing. It also serves to show the company's commitment to debt management and keeping the balance sheet looking healthy and strong. That should help bolster the company's stock price in the future.

Note: The company and its subsidiaries provide online casino content to iGaming operators all over the world. Collectively, they can boast an online casino games library that includes hundreds of video slots. Featured games include "Raging Rhino," "88 Fortunes Megaways," and "Monopoly - Big Event."