The SJM bond buyback marks a decisive step for SJM Holdings as it approaches a major debt maturity. The Macau casino operator must address $500 million in senior notes due later this month. To manage the risk, SJM launched a bond tender offer while preparing a new debt issuance. These moves show how urgent the situation has become.
Investors and rating agencies are watching closely. The company operates in a competitive market while carrying high leverage. How well SJM executes this refinancing will shape its near term financial stability.
SJM Bond Buyback Details and Tender Offer Timeline
Under the SJM bond buyback, the company offered to repurchase up to $500 million of senior notes maturing on January 27. Noteholders who tender will receive $1,000 per $1,000 of principal, plus accrued interest.
The tender offer expires on January 12. SJM expects to settle payments around January 16. This tight schedule leaves little margin for error. The company must complete the process before the bonds reach maturity.
The structure gives investors a clear exit option. At the same time, it places pressure on SJM to secure replacement funding quickly.
SJM Bond Buyback Linked to New Senior Notes Issuance
To support the SJM bond buyback, the group plans to issue new U.S. dollar–denominated senior notes. A wholly owned subsidiary will issue the debt. SJM will use the proceeds to refinance existing offshore borrowings.
Any remaining funds will support general corporate purposes. This includes working capital and ongoing operations. The strategy allows SJM to extend debt maturities and avoid a liquidity crunch.
However, the approach does not reduce total debt in the short term. Instead, it shifts repayment timelines further into the future.
SJM Bond Buyback Draws Caution From Rating Agencies
Rating agencies responded cautiously to the SJM bond buyback and refinancing plan. Moody’s assigned a B1 rating to the proposed notes and kept a negative outlook. The agency pointed to SJM’s high leverage as the main concern.
Moody’s expects leverage to remain between 8.3x and 8.7x EBITDA in 2025. That level limits the chance of a near term upgrade. Fitch Ratings also assigned a BB rating with a negative outlook.
Fitch highlighted weaker market share and slower property ramp up. Both agencies agree that earnings growth, not refinancing alone, must drive future improvement.
SJM Bond Buyback Amid Market Share Declines
The SJM bond buyback comes as the company struggles to regain momentum in Macau. In the third quarter of 2025, SJM’s market share fell to 11.8%. Gaming revenue declined 5% year over year.
This drop contrasts with the wider Macau market, which grew 12.5% during the same period. Competitors captured a larger share of mass market demand.
Grand Lisboa Palace remains a weak spot. Non rolling table revenue rose only 1% quarter on quarter, despite ongoing upgrades. The slow ramp up continues to weigh on overall performance.
SJM Bond Buyback Supported by Solid Liquidity
Despite operational challenges, the SJM bond buyback benefits from strong liquidity. SJM reported about HKD 2.1 billion in cash on hand. The company also has access to committed revolving credit facilities.
Together, these resources can cover debt maturities over the next 12 to 18 months. Moody’s noted that this liquidity reduces short term refinancing risk.
If SJM completes the new bond issuance successfully, liquidity will improve further. This buffer gives management time to focus on performance rather than survival.
SJM Bond Buyback and Operational Strategy Adjustments
Management views the SJM bond buyback as part of a broader turnaround effort. One key move involves reallocating gaming tables from satellite casinos to SJM owned properties. This shift should improve margins and control.
The acquisition of the L’Arc Hotel also supports this strategy. The asset adds incremental earnings and strengthens the company’s self owned portfolio.
These changes will not transform results overnight. Still, they provide a clearer path toward steadier cash flow.
Policy Risks
The long term impact of the SJM bond buyback depends on Macau’s policy environment. Gaming revenue remains sensitive to changes in China’s travel rules and regulatory stance.
Macau’s long term growth outlook remains positive. However, operators with high leverage face greater risk during downturns. Geographic concentration adds another layer of uncertainty for SJM.
Analysts expect leverage to decline toward 6x EBITDA by 2026. That scenario assumes continued market growth and stronger earnings.
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Conclusion
The SJM bond buyback represents a turning point for SJM Holdings. It eases near term pressure and prevents a disruptive maturity event. At the same time, it highlights ongoing leverage and performance risks.
Investors should track execution closely. Key factors include the success of the new bond sale, progress at Grand Lisboa Palace, and Macau market trends. For more insights, visit our Macau business.
SJM has bought itself time. Whether it can use that time wisely will determine its future standing in Macau’s competitive casino market.
