MGM Resorts redeems remaining $700m from real estate partner
MGM Resorts has redeemed the remaining $700m from its agreement with real estate investment trust partner MGM Growth in a move that ensures liquidity through the Covid-19 pandemic.
In exchange MGM Resorts will give MGP approximately 23.5m of operating partnership units.
MGM Resorts said it will use the proceeds for general corporate purposes.
The agreement between MGM Resorts and the REIT allows for the hospitality and entertainment company to redeem up to $1.4bn. MGM Resorts and MGP agreed to a previous $700m deal in May.
MGM Resorts will retain 53% economic ownership of MGP, or approximately 149m units.
“Today’s announcement reflects our continued focus on enhancing our balance sheet to strengthen our financial flexibility,” said Bill Hornbuckle, CEO and President of MGM Resorts. “As the pandemic continues to impact operations at our properties across the U.S., we believe the opportunistic exercise of our redemption right as well as our recent senior notes offering allow us to continue pursuing our strategic goals while navigating the crisis.”
MGM Resorts reported liquidity of $5.9bn for the third quarter ending on 30 Sep.
MGP ended the quarter with $655m of cash and cash equivalent. In November, the REIT priced $750m of senior notes, an increase of $250m from the initial $500m offering.
MGP earned rental revenue of $188m last quarter, down nearly $32m year-on-year.
“Our recent capital raise will allow us to fully fund this final redemption under the waiver agreement with cash on hand while still maintaining a balance sheet positioned for future growth,” said James Stewart, CEO of MGM Growth Properties.
Tags/Keywords
Players trust our reporting due to our commitment to unbiased and professional evaluations of the iGaming sector. We track hundreds of platforms and industry updates daily to ensure our news feed and leaderboards reflect the most recent market shifts. With nearly two decades of experience within iGaming, our team provides a wealth of expert knowledge. This long-standing expertise enables us to deliver thorough, reliable news and guidance to our readers.
Latest News
