MGM Resorts To Buy Remaining Stake In Its Joint Venture On Las Vegas Strip
MGM Resorts will buy the remaining 50% stake in its joint venture on the Las Vegas Strip from a unit of investment firm Dubai World for $2.12 billion, the US casino operator has said.
The venture, CityCenter Holdings, is an urban complex comprising Aria Resort and Casino and Vdara Hotel and Spa.
After buying it from Infinity World Development Corp, MGM said that it will sell the two properties to private equity firm Blackstone for $3.89 billion in cash.
"Asset Light" Strategy
The deal is part of MGM's “asset light” strategy to generate cash by selling real estate and use it for growth avenues such as sports betting and casino development in Japan.
MGM Resorts Chief Executive Statement
"We expect to continue executing on our asset-light strategy and utilising the proceeds from our real estate transactions to...secure new growth opportunities," MGM Resorts chief executive Bill Hornbuckle said.
Lease And Deal Completion
Blackstone will lease the Aria and Vdara properties to MGM for an initial annual rent of $215 million, the company said. The deals are expected to close in the third quarter.
MGM's purchase price for CityCenter values the complex at approximately $5.8 billion, including net debt of $1.5 billion.
MGM shares have gained approximately 35% this year.