MGM noted that Gold Strike reported net income of $47m and adjusted Property EBITDAR of $98m for the year ended 31 December 2022.
The company added that at the closing of the transaction its master lease with VICI Properties – which currently includes the Gold Strike Property – will be amended to reduce the annual rent by $40m to account for the group’s sale of the operations of Gold Strike.
MGM expects net cash proceeds after taxes and estimated fees to be approximately $350m. Weil, Gotshal & Manges LLP served as legal counsel to MGM Resorts.
“Gold Strike is an iconic property in Mississippi, and the employees there represent southern hospitality at its finest,” said MGM Resorts International CEO & President Bill Hornbuckle. “I wish Gold Strike well, and firmly believe a bright future is ahead for this property.”
MGM Resorts International CFO & Treasurer Jonathan Halkyard commented: “We plan to use the proceeds from this transaction to further fortify our balance sheet, deploy capital to growth opportunities, and return capital to shareholders.”
In other selling news, Churchill Downs Incorporated (CDI) has closed on the sale of 326 acres of property in Arlington Heights, Illinois, to the Chicago Bears for $197.2m. This is per the agreement dated September 2021.
CDI will apply the proceeds of the sale to the purchase of, and improvements to, real property previously acquired in connection with the Peninsula Pacific Gaming acquisition that closed in 2022.