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|MGM||MGM RESORTS INTERNATIONAL||31.81||+0.28||+0.89%|
During a conference call with investors on Wednesday, MGM CEO Jim Murren detailed plans to sell the MGM Grand casino – and will likely announce a buyer by the end of the year.
MGM recently announced the sales of Bellagio’s real estate to Blackstone Group and Circus Circus to Phil Ruffin, who owns the Treasure Island Hotel and Casino, which is privately held.
Murren referred to the Bellagio sale as “one of the most sophisticated agreements” the company had ever entered into, considering the partnership with one of the world’s “top real estate investors” Blackstone Group. It is a sale-leaseback agreement, where MGM will retain a 5 percent stake.
The pair of deals is expected to result in net cash proceeds of about $4.3 billion, which will first be used to pay down debt. Murren estimates they will close by the end of 2019. The MGM Grand deal will likely close in early 2020.
Murren also said he envisions the future of the company as an “asset-light” casino operator.
The company reported a 9 percent increase in revenue in the third quarter and a net loss of $37 million. It incurred a $219 million impairment charged related to the Circus Circus sale.