ATLANTIC CITY, N.J.
MGM Resorts International announced it has entered into a definitive agreement to acquire Boyd Gaming Corporation's 50 percent interest in Borgata Hotel Casino & Spa in Atlantic City, N.J., for consideration of $900 million, which it will then sell to MGM Growth Properties LLC (MGP).
MGP will reportedly acquire Borgata's real property from MGM Resorts for around $1.18 billion, according to an official release, and lease back the real property to a subsidiary of MGM Resorts.
For the last 12 months ended March 31, 2016, Borgata reported $812 million in net revenues.
"Borgata is the premier resort in Atlantic City and a great addition to our growing presence in the Northeast," said Jim Murren, Chairman and CEO of MGM Resorts International. "While the market continues to experience challenges, Borgata has outperformed and differentiated itself as the undisputed leader in the city. Our decade-long partnership with Boyd Gaming has been a great one, and Borgata's talented employee base will complement and strengthen … our MGM Resorts team.”
MGP expects to fund the acquisition of the Borgata real property and the assumption of related debt with a combination of existing cash on hand, borrowings under its senior secured revolving credit facility, and the issuance of operating partnership units to a subsidiary of MGM Resorts.
The transactions are expected to close in the third quarter of 2016, subject to regulatory approvals.
