A group of four banks led by Bankers Trust Co. has underwritten a $650 million refinancing or Promus Cos., which operates casinos under the Harrah's name.

As managing agent, Bankers Trust underwrote $275 million of the five-year revolving credit. Bank of New York, Credit Lyonnais, and Sumitomo Bank each underwrote $125 million.

The same four banks, along with Citibank, led a roughly $1 billion credit package for Promus in 1990, when the company spun off its Holiday Inns business as part of a recapitalization.

It wasn't immediately clear why Citibank is not an underwriter of the new bank deal.

Riverboat Gambling Business

The credit will refinance about $560 million of existing bank debt and help fund the planned expansion of the company's riverboat gambling business.

Promus opened its first riverboat casino last month in Joliet, Ill., and plans to open seven more in Mississippi, Missouri, Louisiana, and illinois.

Promus, based in Memphis, loaded up on debt to finance special dividends to shareholders in 1987 and again in 1990.

Since then, though, the company has pared its debt with internally generated funds and the proceeds of a common stock offering in 1991.

At yearend 1992, debt leverage was about 69%, compared with 83% in 1990, noted a Standard & Poor's Corp. analyst, John Maxwell, in a recent report. The company's implied senior debt rating is BB-plus, just one notch below investment grade.

Mr. Maxwell said the company's ratings outlook is "positive," meaning that it could be upgraded to investment grade in the next one to three years.

"We have to get comfortable that they'll maintain a more conservative financial policy going forward," he said.

Improved Credit Terms

The banks have already rewarded Promus with improved credit terms. Pricing of the new revolver is set at 150 basis points over the benchmark London interbank offered rate, a reduction of 100 basis points off the rate on its existing bank debt.

A bank meeting for potential syndicate members is scheduled to be held in two weeks.

There is a fairly limited universe of banks that lend to the gambling industry. Promus' gaming operations account for about 80% of its revenues and operating income, The company also operates the Embassy Suites, Hampton Inn. and Homewood Suites hotel chains.

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