Nevada Gaming Commission approves MGM’s buyout bid of CityCenter
MGM intends to sell CityCenter to the Blackstone Group for $3.89bn
The Nevada Gaming Commission (NGC) has approved MGM Resorts’ bid to buy out Dubai World’s 50% stake of CityCenter, the 16.8m-square-foot complex that includes Aria and Vdara.
The NGC voted unanimously in support of the buyout following recommendation from the Nevada Gaming Control Board. The move ends a 14-year 50-50 partnership between MGM and Dubai World, an investment company owned by the United Arab Emirates.
MGM will break Aria and Vdara into two separate property companies and sell them to the Blackstone Group for $3.89bn, who will lease the properties back to MGM for $215m in annual rent payments.
MGM operates the Bellagio and MGM Grand under similar leaseback agreements with Blackstone.
Dubai World maintains a 4.3% ownership in MGM stock but is unlikely to re-enter into the U.S. gaming business.
Dubai World entered the Las Vegas Strip with a 50% stake in the CityCenter development in November 2007, making it the first country to earn a Nevada gaming license.
Dubai World counsel Jeff Silver of Dickinson Wright told the NGC that the investment company’s contribution of $5bn into the development of CityCenter kept the project afloat during the Great Recession.
“That project kept tens of thousands of workers employed for the construction of this facility and gave Las Vegas a shot in the arm at the time it needed it most,” Silver said.
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