Business

MGM Set to Sell Las Vegas Casinos Mandalay Bay and MGM Grand

MGM Resorts International said it plans to sell the MGM Grand and Mandalay Bay resorts and casinos in Las Vegas.

The buyer is a joint venture between private-equity and real estate giant Blackstone and MGM Growth, a real estate investment trust.

The deal is expected to funnel around $2.4 billion cash into MGM Resorts coffers and generate $85 million in MGM Growth partnership units. The joint venture will lease both the MGM Grand and Mandalay Bay properties to MGM Resorts for an initial rent of $292 million.

The company said in a statement on Tuesday that the transaction is part of its “asset-light strategy and provides MGM Resorts with a significant return of capital opportunity.”

In this photo taken Thursday, Jan. 14, 2016, cars drive into the MGM Grand hotel and casino in Las Vegas. Casino giant MGM Resorts International will announce Friday, Jan. 15, that it plans to begin charging visitors for parking this year at some of its properties in Las Vegas. (AP Photo/John Locher) File photo showing cars driving into the MGM Grand hotel and casino in Las Vegas, Nevada, on Jan. 14, 2016. (AP Photo/John Locher)

The firm said that selling MGM Grand and Mandalay Bay would, in combination with the expected redemption of some $1.4 billion in operating partnership units along with previously announced Bellagio and Circus Circus Las Vegas transactions, provide MGM Resorts with a net cash injection of $8.2 billion.

The transactions are a way to shore up its balance sheet, MGM Resorts said, and will boost the firms ambitions in the global gaming, hospitality, and entertainment sectors.

“Our corporate objective remains crystal clear,” said Jim Murren, Chairman and CEO of MGM Resorts. “We will continue to monetize our owned real estate assets, which facilitates our strong focus on returning capital to our shareholders, while also retaining significant flexibility to pursue our visible growth initiatives, including Japan and sports betting.”

MGM Resorts, which has a market value of just over $17 billion, has for some time been looking at real estate deals as a way to settle some of its liabilities.

Last year, MGM Resorts agreed to pay up to $800 million to settle thousands of claims stemming from the 2017 mass shooting in Las Vegas, in which a shooter on the 32nd floor of the Mandalay Bay resort opened fire on a crowd of concertgoers, killing 58 and injuring hundreds. Lawyers announced the settlement in early October 2019, almost two years to the day after the massacre.

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