MGM Resorts International (NYSE: MGM) today announced it has closed on the sale of the operations of Gold Strike Tunica to CNE Gaming Holdings, L.L.C., a subsidiary of Cherokee Nation Businesses, for $450 million in cash.
"Gold Strike is an iconic property in Mississippi, and the employees there represent southern hospitality at its finest," said Bill Hornbuckle, CEO & President, MGM Resorts International. "I wish Gold Strike well, and firmly believe a bright future is ahead for this property."
"We plan to use the proceeds from this transaction to further fortify our balance sheet, deploy capital to growth opportunities, and return capital to shareholders," said Jonathan Halkyard, CFO & Treasurer, MGM Resorts International.
For the year ended December 31, 2022, Gold Strike reported net income of $47 million and Adjusted Property EBITDAR of $98 million1. At the closing of the transaction, MGM Resorts' master lease with VICI Properties, Inc. (NYSE: VICI) that currently includes the Gold Strike property will be amended to reduce the annual rent by $40 million to account for the Company's sale of the operations of Gold Strike. The Company expects net cash proceeds after taxes and estimated fees to be approximately $350 million.
Weil, Gotshal & Manges LLP served as legal counsel to MGM Resorts.
| 1 | Calculated as net income of $47 million, adjusted for $3 million of depreciation and amortization, $7 million of property transactions, net, and $41 million of rent expense associated with triple-net operating leases. |