WASHINGTON (dpa-AFX) - MGM Resorts International (MGM) Tuesday said it has agreed to sell the Bellagio resort in Las Vegas to Blackstone Group for $4.25 billion.
However, MGM Resorts will lease it back from Blackstone Group for initial annual rent of $245 million and continue to operate the property.
MGM Resorts will receive a 5% equity interest in the joint venture and cash of about $4.2 billion. The transaction is expected to close in the fourth quarter of 2019, subject to certain closing conditions.
The Las Vegas-based casino company also agreed to sell the Circus Circus property in Las Vegas, along with 47 adjoining acres, to real estate mogul Phil Ruffin for $825 million.
'This transaction confirms the premium value of our owned real estate assets, highlights the unique value of Bellagio as a premier asset in gaming and solidifies our status as a premier operator of gaming and entertainment properties. We will use the proceeds from this transaction, together with the proceeds from the pending sale of Circus Circus Las Vegas, to build a fortress balance sheet and return capital to shareholders,' said Jim Murren, Chairman and CEO of MGM Resorts International.
The company expects to utilize the proceeds from the transaction to enhance its capital allocation strategy and complement its strategic and operational flexibility.
Murren said the transactions will help the company target new growth opportunities, including one of the new integrated resource licenses in Japan and sports betting in the U.S.
Copyright RTT News/dpa-AFX
© 2019 AFX News
