MGM to Sell Gold Strike Tunica

Wonder if CET looks to sell the Horseshoe..I liked it there, wish they would run more Junkets


MGM RESORTS INTERNATIONAL ANNOUNCES AGREEMENT TO SELL OPERATIONS OF GOLD STRIKE TUNICA FOR $450 MILLION

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MGM Resorts International

Jun 09, 2022, 16:30 ET
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Purchase price represents an approximate 11 times multiple on average Adjusted Property EBITDA from 2019-2021

LAS VEGAS, June 9, 2022 /PRNewswire/ -- MGM Resorts International (NYSE: MGM) ("MGM Resorts" or the "Company") today announced that it has reached an agreement to sell the operations of Gold Strike Tunica ("Gold Strike") to Cherokee Nation Entertainment Gaming Holdings, LLC ("CNE"), a subsidiary of Cherokee Nation Businesses, for $450 million in cash, subject to customary adjustments.

"I want to thank all of our Gold Strike employees who have consistently delivered world-class gaming and entertainment experiences to our guests," said Bill Hornbuckle, CEO & President, MGM Resorts International. "Gold Strike is a wonderful property with a bright future ahead. Strategically, though, we decided to narrow our focus in Mississippi to a single resort – Beau Rivage – and dedicate more of our time and resources towards continuing to drive success at that leading, world-class resort and casino."

For the twelve months ended December 31, 2021, Gold Strike reported net income of $81.1 million and Adjusted Property EBITDAR of $115 million1, reflecting benefits from certain market specific factors in the last year. Pre-pandemic, Gold Strike reported Adjusted Property EBITDAR of $67 million in 2019. At the closing of the transaction, MGM Resorts' master lease agreement with VICI Properties Inc. (NYSE: VICI), which currently includes Gold Strike, will be amended to reduce annual rent by $40 million. The Company expects net cash proceeds after taxes and estimated fees to be approximately $350 million.

"This is a great outcome for the Company as we are able to reprioritize future capital expenditures toward opportunities that will enhance the customer experience at our other locations," said Jonathan Halkyard, CFO & Treasurer, MGM Resorts International. "We appreciate VICI, as the real estate owner of Gold Strike, working constructively with CNE to facilitate a new lease agreement."

Gold Strike opened in 1994 and was acquired by MGM Resorts in 2005. At 32 stories tall, the iconic property is one of the most recognizable buildings in Tunica and towers above all other structures. When it was built the gold tower was reported to be the tallest building in Mississippi.

The transaction is expected to close in the first half of 2023, subject to regulatory approvals and other customary closing conditions.

It makes sense, and especially with the decline of Tunica over the years. It looks like a beautiful property, but I have never been, and to be honest never had a desire to visit.

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