LAS VEGAS, Feb. 15, 2023 /PRNewswire/ -- MGM Resorts International (NYSE: MGM) ("MGM Resorts" or the "Company") today announced it has closed on the sale of the operations of Gold Strike Tunica ("Gold Strike") to CNE Gaming Holdings, L.L.C., a subsidiary of Cherokee Nation Businesses, for $450 million in cash.
"Gold Strike is an iconic property in Mississippi, and the employees there represent southern hospitality at its finest," said Bill Hornbuckle, CEO & President, MGM Resorts International. "I wish Gold Strike well, and firmly believe a bright future is ahead for this property."
"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," said Jonathan Halkyard, CFO & Treasurer, MGM Resorts International.
For the year ended December 31, 2022, Gold Strike reported net income of $47 million and Adjusted Property EBITDAR of $98 million1. At the closing of the transaction, MGM Resorts' master lease with VICI Properties, Inc. (NYSE: VICI) that currently includes the Gold Strike property will be amended to reduce the annual rent by $40 million to account for the Company's sale of the operations of Gold Strike. The Company expects net cash proceeds after taxes and estimated fees to be approximately $350 million.
Weil, Gotshal & Manges LLP served as legal counsel to MGM Resorts.
1
| Calculated as net income of $47 million, adjusted for $3 million of depreciation and amortization, $7 million of property transactions, net, and $41 million of rent expense associated with triple-net operating leases.
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About MGM Resorts International
MGM Resorts International (NYSE: MGM) is an S&P 500® global entertainment company with national and international locations featuring best-in-class hotels and casinos, state-of-the-art meetings and conference spaces, incredible live and theatrical entertainment experiences, and an extensive array of restaurant, nightlife and retail offerings. MGM Resorts creates immersive, iconic experiences through its suite of Las Vegas-inspired brands. The MGM Resorts portfolio encompasses 31 unique hotel and gaming destinations globally, including some of the most recognizable resort brands in the industry. The Company's 50/50 venture, BetMGM, LLC, offers sports betting and online gaming in North America through market-leading brands, including BetMGM and partypoker, and the Company's subsidiary LeoVegas AB offers sports betting and online gaming through market-leading brands in several jurisdictions throughout Europe. The Company is currently pursuing targeted expansion in Asia through the integrated resort opportunity in Japan. Through its "Focused on What Matters: Embracing Humanity and Protecting the Planet" philosophy, MGM Resorts commits to creating a more sustainable future, while striving to make a bigger difference in the lives of its employees, guests, and in the communities where it operates. The global employees of MGM Resorts are proud of their company for being recognized as one of FORTUNE® Magazine's World's Most Admired Companies®. For more information, please visit us at www.mgmresorts.com. Please also connect with us @MGMResortsIntl on Twitter as well as Facebook and Instagram.
Forward Looking Statements:
Statements in this release that are not historical facts are forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, and involve risks and/or uncertainties, including those described in the Company's public filings with the Securities and Exchange Commission. Forward-looking statements can be identified by the use of forward-looking terminology such as "believes," "expects," "could," "may," "will," "should," "seeks," "likely," "intends," "plans," "pro forma," "projects," "estimates" or "anticipates" or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters. The Company has based forward-looking statements on management's current expectations and assumptions and not on historical facts. Examples of these statements include, but are not limited to, the Company's expectations regarding any benefits expected to be received from the sale, including the Company's expected net cash proceeds. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise, and the Company may not be able to realize them. The Company does not guarantee that the transaction or other events described herein will happen as described (or that they will happen at all). These forward-looking statements involve a number of risks and uncertainties. Among the important factors that could cause actual results to differ materially from those indicated in such forward-looking statements include risks related to the continued impact of the COVID-19 pandemic on the Company's business, the effects of economic conditions and market conditions in the markets in which the Company operates and competition with other destination travel locations throughout the United States and the world, the design, timing and costs of expansion projects, risks relating to international operations, permits, licenses, financings, approvals and other contingencies in connection with growth in new or existing jurisdictions and additional risks and uncertainties described in the Company's Form 10-K, Form 10-Q and Form 8-K reports (including all amendments to those reports). In providing forward-looking statements, the Company is not undertaking any duty or obligation to update these statements publicly as a result of new information, future events or otherwise, except as required by law. If the Company updates one or more forward-looking statements, no inference should be drawn that it will make additional updates with respect to those other forward-looking statements.
Non-GAAP Financial Measures:
This press release includes Adjusted Property EBITDAR for Gold Strike Tunica, which is a "non-GAAP financial measure" as defined in Regulation G under the Securities Exchange Act of 1934, as amended. For a reconciliation of Adjusted Property EBITDAR to net income see footnote 1 to this press release.
MGM RESORTS CONTACTS
Investment Community:
SARAH ROGERS, Senior Vice President of Corporate Finance
(702) 730-3942, srogers@mgmresorts.com
ANDREW CHAPMAN, Director of Investor Relations
(702) 693-8711, achapman@mgmresorts.com
News Media:
BRIAN AHERN, Executive Director of Communications
media@mgmresorts.com
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SOURCE MGM Resorts International
