MGM Resorts International has entered into a definitive agreement to purchase Infinity World Development Corp's (Infinity World) 50% interest in CityCenter Holdings for US$2.125 billion. The deal will make MGM Resorts the 100% owner of CityCenter on the Las Vegas Strip, which is comprised of Aria Resort & Casino and Vdara Hotel and Spa.
"CityCenter has consistently elevated the Las Vegas experience over the years, contributing to this vibrant city's undeniable position as a top tourism and business destination," said Bill Hornbuckle, CEO and President of MGM Resorts.
"Uniting all of CityCenter under MGM Resorts' corporate structure and strategy will allow us to consolidate financial results, build on efforts to strengthen our operating model and guest experience and further our vision of becoming the world's premier gaming entertainment company," Hornbuckle added.
MGM Resorts has also entered into a definitive agreement with Blackstone to monetize the Aria and Vdara real estate assets, pending the close of the equity purchase agreement between MGM Resorts and Infinity World. Under terms of the agreement, funds managed by Blackstone will acquire the Aria and Vdara real estate for US$3.89 billion in cash, which represents a multiple of 18.1x rent. Following the acquisition, both properties will be leased to MGM Resorts for initial annual rent of US$215 million.
Regarding the real estate agreement with Blackstone, Hornbuckle added: "This transaction demonstrates the unprecedented premium value of our real estate assets and is a testament to Aria and Vdara's status as premier destinations on the Las Vegas Strip. We expect to continue executing on our asset-light strategy and utilizing the proceeds from our real estate transactions to enhance our financial flexibility and secure new growth opportunities."
The transactions are expected to close in the third quarter, subject to certain closing conditions.
Source: GMB
