LAS VEGAS, Dec. 20, 2018 /PRNewswire/ -- MGM Resorts
International ("MGM Resorts") (NYSE: MGM) and MGM Growth Properties
LLC ("MGP") (NYSE: MGP) announced today that they have entered into
an agreement whereby MGP will pay MGM Resorts consideration of
$637.5 million for investments made
to reposition Park MGM and NoMad Las Vegas, which was formerly
known as Monte Carlo Resort and Casino. As part of this agreement,
the annual rent under the existing Master Lease between MGM Resorts
and MGP will increase by $50
million.
"The creation of Park MGM and NoMad Las Vegas, in conjunction
with T-Mobile Arena, Park Theater and the entire mid-Strip
neighborhood, further solidify our position as a global resort and
entertainment leader," said Jim Murren, Chairman and CEO of
MGM Resorts. "As we continue to execute our multifaceted strategic
plan, and as part of our ongoing efforts to optimize our portfolio,
we believe that these prudent investments in our assets will bring
substantial value to MGM Resorts, MGP and our respective
shareholders."
"Park MGM and NoMad Las Vegas are exciting new concepts on the
Las Vegas Strip, further enhancing our already outstanding
portfolio," said James Stewart, Chairman and CEO of MGM Growth
Properties. "MGM Resorts has invested in the significant
repositioning of Park MGM and NoMad Las Vegas and we are excited to
partner with MGM Resorts for these iconic assets. We intend to fund
the consideration through a combination of cash and availability
under our credit facility. This transaction will be immediately
accretive to our AFFO and further demonstrates the power of our
business model and partnership with MGM Resorts."
Concluded Murren, "MGM Resorts will continue to deliberately
reduce our owned real estate through accretive transactions in the
future. MGP is an attractive partner to achieve this goal. We
remain committed to our stated strategic objectives, including
reducing our ownership stake in MGP."
Rockefeller Capital Management is acting as financial advisor to
the conflicts committee of the MGP Board of Directors.
Consistent with the Master Lease terms, 90 percent of the
increased rent will be contractually fixed to grow at two percent
per year until 2022, and thereafter will continue to grow provided
a tenant revenue to rent ratio is met. The remaining 10 percent is
payable in percentage rent. The transaction is expected to close in
the first quarter of 2019 and is subject to customary closing
conditions.
About Park MGM and NoMad Las Vegas
Located in the
heart of the Las Vegas Strip, next to the 20,000-seat T-Mobile
Arena and a surrounding entertainment and dining neighborhood, Park
MGM and NoMad Las Vegas offer an intimate resort experience on a
grand scale. Park MGM features 2,700 guest rooms and suites; and
the Las Vegas extension of Sydell
Group's NoMad hotel features 293 well-appointed guest rooms and
suites. The resort's remarkable culinary program features NoMad
Restaurant and NoMad Bar from Will
Guidara and Daniel Humm;
Hogsalt Hospitality's renowned Bavette's Steakhouse; and L.A.
legend Roy Choi's Korean BBQ concept
Best Friend. December 2018 debuts
include the 40,000-square-foot vibrant Italian marketplace Eataly
among other dining and cocktail experiences, as well as a unique
nightlife concept from LA-based Houston Hospitality, On The Record.
Park Theater, the resort's entertainment destination, is a
5,200-seat venue home to special engagements by Lady Gaga,
Bruno Mars, Britney Spears, Aerosmith and other top
entertainers. For more information and reservations, visit
ParkMGM.com, call toll-free at 888-529-4828 or follow on Facebook
or Twitter.
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
28 unique hotel offerings including some of the most recognizable
resort brands in the industry. Expanding throughout the U.S. and
around the world, the company in 2018 opened MGM Springfield in
Massachusetts, MGM COTAI in
Macau, and the first
Bellagio-branded hotel in Shanghai. The 81,000 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 visit us at www.mgmresorts.com.
About MGM Growth Properties
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. MGP currently owns a portfolio
of properties, consisting of 11 premier destination resorts
in Las Vegas and elsewhere across the United States, the Park, a dining and
entertainment complex which opened in April 2016, and the Hard
Rock Rocksino Northfield Park in Northfield, OH. As
of December 31, 2017, these properties collectively comprise
approximately 27,500 hotel rooms, 2.7 million convention square
footage, 150 retail outlets, 300 food and beverage outlets and 20
entertainment venues. As a growth-oriented public real estate
entity, MGP expects its relationship with MGM Resorts and other
entertainment providers to attractively position MGP for the
acquisition of additional properties across the entertainment,
hospitality and leisure industries. For more information about MGP,
visit the Company's website at
http://www.mgmgrowthproperties.com.
Forward-Looking Statements
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 MGM Resorts' and MGP
public filings with the SEC. MGM Resorts and MGP have 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, statements regarding
the closing of the transaction, the expected benefits to be
achieved as a result of the transaction and MGM Resorts' ability to
execute on its strategic objectives. 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
MGM Resorts and MGP operate, 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 MGM Resorts' and MGP Form
10-K, Form 10-Q and Form 8-K reports (including all amendments to
those reports). In providing forward-looking statements, neither
MGM Resorts or MGP 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 MGM
Resorts 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 Resorts International; MGM Growth Properties LLC