Eldorado Resorts and MGM Resorts International announced that they have entered into an agreement for Eldorado to acquire MGM’s 50 percent interest in the Silver Legacy Resort Casino Reno, as well as all of the assets of Circus Circus Reno, for $72.5 million cash.
In addition, ERI, which owns the other 50 percent interest in Silver Legacy, expects that it will repay amounts outstanding under the Silver Legacy credit facility, of which approximately $60 million was outstanding at March 31, 2015 on a net debt basis.
The acquisitions are not subject to a financing condition and are expected to be funded by Eldorado through cash on hand and future capital market or financing transactions.
“The acquisition of these well-established properties represents a significant growth and expansion opportunity for Eldorado and is consistent with our strategy to enhance shareholder value by structuring transactions that are strategically and economically attractive. The acquisition is expected to be accretive to our operating results upon closing, builds the critical mass of our gaming operations and fortifies our position in the increasingly attractive Reno gaming market,” said Gary Carano, chairman and CEO of Eldorado.
The Silver Legacy is a Nevada mining-themed hotel-casino and entertainment complex which features an approximately 89,200-square foot gaming floor with 1,340 slot machines, 63 table games and 1,711 hotel rooms.
Circus Circus Reno is a circus-themed hotel-casino and entertainment complex which features an approximately 56,000-square foot gaming floor with 906 slot machines, 35 table games and 1,571 hotel rooms.
The transaction is expected to be completed by year-end 2015.