Under the terms of the Harrah's sale agreement, Caesars will receive US$1.14 billion in cash in return for Harrah's Las Vegas' real estate assets. Under the terms of the convention center agreement, Caesars will acquire 18.4 acres of adjacent land from VICI as part of Caesars Entertainment's plan to develop a new 300,000 square-foot convention center.
The proceeds of the Harrah's Las Vegas sale will be the primary source of funds for the previously announced purchase of Centaur Holdings. The planned convention center is expected to become a leading destination for meetings on the Las Vegas Strip.
"The transactions we are announcing today demonstrate our commitment to pursuing growth opportunities while maintaining balance-sheet discipline," said Mark Frissora, President and Chief Executive Officer of Caesars Entertainment.
Caesars will continue to operate Harrah's Las Vegas, including gaming, hotel operations and all other amenities.
As part of the sale and leaseback transaction, Caesars and VICI will enter into a 15-year lease for Harrah's Las Vegas under which Caesars will pay initial annual rent of US$87.4 million. The rent will increase contractually in subsequent years. Caesars will have the option to extend the lease for an additional 20 years via four five-year extensions.
Source: GMB / Reuters
