LAS VEGAS, Aug. 1, 2016 /PRNewswire/ -- MGM Growth
Properties LLC (NYSE: MGP) and MGM Resorts International ("MGM
Resorts") (NYSE:MGM) completed the transactions for the
acquisition of Borgata Hotel Casino & Spa ("Borgata") following
MGM Resorts' purchase of Boyd Gaming's stake in Borgata. MGP
acquired Borgata's real property from MGM Resorts and leased back
the real property to a subsidiary of MGM Resorts that will operate
that property.
MGP funded the acquisition of the Borgata real property and
refinanced its assumption of $545
million of debt from a subsidiary of MGM Resorts with
$260 million of cash on hand,
$295 million of borrowings under its
senior secured revolving credit facility and the issuance of
27,362,136 operating partnership units to a subsidiary of MGM
Resorts.
"Our ability to enhance our portfolio with a premier asset like
Borgata in such early stages of our company demonstrates our focus
on prudent growth and the financial flexibility of our balance
sheet," said James Stewart, Chief
Executive Officer of MGM Growth Properties. "This transaction
brings geographic diversification and increased cash flows to our
portfolio while maintaining neutral leverage and resulting in high
single digit percentage accretion to AFFO per share."
Borgata was added to the existing Master Lease between MGM
Resorts and MGP, and the initial rent payment to MGP increased by
$100 million. Consistent with the
Master Lease terms, 90 percent of this rent will be fixed and
contractually grow at 2 percent per year until 2022.
About MGM Growth Properties LLC
MGM Growth Properties LLC (NYSE:MGP) is one of the leading
publicly traded real estate investment trusts engaged in the
acquisition, ownership and leasing of large-scale destination
entertainment and leisure resorts, whose diverse amenities include
casino gaming, hotel, convention, dining, entertainment and retail
offerings. In connection with its initial public offering and
subsequent acquisition of Borgata, MGP acquired from MGM Resorts
ten premier destination resorts in Las Vegas and
elsewhere across the United States and one dining and
entertainment complex which opened in April 2016. As
of December 31, 2015, these properties collectively comprise
27,233 hotel rooms, approximately 2.6 million convention square
footage, over 100 retail outlets, over 200 food and beverage
outlets and over 20 entertainment venues. As a growth-oriented
public real estate entity, MGP expects its relationship with MGM
Resorts to attractively position MGP for the acquisition of
additional properties across the entertainment, hospitality and
leisure industries that MGM Resorts may develop in the future. For
more information about MGM Growth Properties, visit the company's
website at www.mgmgrowthproperties.com.
About MGM Resorts International
MGM Resorts International (NYSE: MGM) is one of the world's
leading global hospitality companies, operating a portfolio of
destination resort brands including Bellagio, MGM Grand, Mandalay
Bay and The Mirage. The Company is in the process of developing MGM
National Harbor in Maryland and MGM Springfield in
Massachusetts. MGM Resorts
controls, and holds a 76 percent economic interest in the operating
partnership of MGM Growth Properties LLC (NYSE: MGP), a premier
triple-net lease real estate investment trust engaged in the
acquisition, ownership and leasing of large-scale destination
entertainment and leisure resorts. The Company also owns 51 percent
of MGM China Holdings Limited (HK: 2282), which owns the MGM Macau
resort and casino and is developing a gaming resort in Cotai, and
50 percent of CityCenter in Las Vegas, which features ARIA
Resort & Casino. MGM Resorts is named among FORTUNE® Magazine's
2016 list of World's Most Admired Companies®. For more information
about MGM Resorts International, visit the company's website at
www.mgmresorts.com.
Statements in this release that are not historical facts
are "forward-looking" statements and "safe harbor statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995 that involve risks and/or uncertainties, including those
described in each of MGM Resorts' and MGP's public filings with the
Securities and Exchange Commission. Management of MGM Resorts and
MGP have based forward-looking statements on their current
expectations and assumptions and not on historical facts. Examples
of these statements include, but are not limited to, any expected
benefits to be realized as a result of the acquisition. 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 effects of economic conditions
and market conditions in the markets in which the companies operate
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, delays or impediments to
completing planned acquisitions or projects, the ultimate timing
and outcome of any planned acquisitions or projects, MGP's ability
to maintain its status as a REIT and additional risks and
uncertainties described in each of MGM Resorts' and MGP's periodic
reports filed with the Securities and Exchange Commission
(including all amendments to those reports). In providing
forward-looking statements, neither company is 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 either 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.
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SOURCE MGM Growth Properties LLC