Eldorado to sell 18 million shares and enter into VICI mortgage agreement
Eldorado has announced plans to sell 18 million shares of its common stock and enter into a mortgage agreement with VICI Properties ahead of its planned merger with Caesars Entertainment.
The casino operator announced it would be selling the shares on Monday, which if sold would generate around $692m based on the day’s closing price of $38.44.
Eldorado has also published a letter of intent to enter into a $400m mortgage deal with VICI Properties for the recently opened Caesars Forum Convention Center in Las Vegas.
The mortgage will last for five years with an interest rate of 7.7% and a 2% annual escalation. It will be pre-payable from the beginning of year three subject to certain conditions.
VICI properties, a real-estate investment trust with an affiliation with Caesars, has also agreed to acquire approximately 23 acres of land from Eldorado.
The land is adjacent to the Las Vegas Strip and will be purchased at a price of $4.5m per acre – generating total proceeds of around $103.5m for the casino operator.
Both transactions are subject to completion of Eldorado’s planned merger with Caesars, which is expected to be closed in July.
Tom Reeg, CEO of Eldorado, said: “We are pleased to further our relationship with VICI through these transactions. The combination of these two transactions will serve to strengthen our balance sheet and provide added liquidity.”
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