MGM Resorts is to purchase Borgata Hotel Casino & Spa in its entirety, after agreeing to buy the remaining 50% stake in the casino from its partner Boyd Gaming for a consideration of $900m.
This does not mean that MGM Resorts will be the sole owner of Borgata, however, as MGM Growth Properties will buy Borgata’s real property from MGM Resorts for approximately $1.175bn after the deal has completed.
MGM Resorts will pay approximately $600m for Boyd’s 50% stake and will assume and refinance Borgata’s $600m of outstanding debt.
Borgata is the market leader in Atlantic City, constantly-topping revenue charts, and generated casino win of $55.1m for 2015, giving it a 31% market share.
This will give MGM Resorts a route into New Jersey’s i-gaming market, where Borgata is once again the market leader, in terms of generated revenue, with internet gaming win for 2015 totalling $3.96m, 28% of the market.
Borgata was founded as a joint venture between Boyd and MGM Mirage and opened in 2003.
The new deal is predicted to complete in the third quarter of 2016 and is subject to regulatory approvals.
Selling its stake in Borgata will mean that no Atlantic City casinos will form part of Boyd’s casino portfolio, which includes 21 other casinos across eight US states.
That portfolio will be expanded when Boyd finalises its purchases of the Aliante Casino Hotel and Spa and the Las Vegas assets of Cannery Casino Resorts for $380m and $230m respectively.
Source: Gambling Insider