Vici Properties and Century Casinos to Purchase Eldorado Resorts Properties For $385 Million

Casino entertainment firm, Eldorado Resorts, has confirmed that interest exists on the side of Vici Properties and Century Casinos who are plotting to take over three Eldorado facilities for a combined sum of $385 million.

The three venues in question are Isle Casino Cape Girargeau in Cape Girardeau, Missouri, Caurthersville’s Lady Luck Casino and New Cumerland’s Missouri and Mountaineer Casino, Racetrack and Resort in West Virginia.

A Complex Arrangement

According to the minutiae of the deal…

…Vici would become the sole owner of the land and real estate assets of all these properties (for $278 million) while Century will obtain the operating assets for $107 million.

As soon as the transaction is closed, Vici will enter into a “triple-net master lease” with Century, which will apply to the assets with an initial annual rent of $25 million across 15 years. This will also contain a 5-year renewal clause.

The expected timeframe for closure of the transaction is early 2020, while the acquisition itself will be subject to antitrust approval and being okayed by the Missouri Gaming Commission and West Virginia Lottery – along with numerous other closing conditions that are obligatory in events such as these.

Multiple Benefits For Vici

Vici Properties President and Chief Operations Officer, John Payne, said that this transaction clearly demonstrates the company’s ability to execute accretive acquisitions that will bring value to shareholders…

…while at the same time, it will diversify the tenant base and expand its geographical footprint to West Virginia.

“We are excited to partner with Century, as they are expert operators of small to mid-sized regional assets and are beginning their journey of expansion into the US market. Cape Girardeau, Caruthersville and Mountaineer are competitive local assets in stable regional markets and are a great fit for Century’s growing portfolio.”

He went on to add that the very nature of this purchase will provide space for both Century and Eldorado to put the strategic value for their shareholders in a better perspective, while Vici itself will pursue their strategic goals to diversify and grow its portfolio.

Accretion and Getting Number Ten

Once the acquisitions are complete…

…Century will update their North American portfolio to ten casino venues and will own over 6,700 gaming machines and 150 table games.

Century Casinos co-chief executive, Erwin Haitzmann, was very eager to share his perspective:

“This transaction further highlights our commitment to enhancing shareholder value. Cape Girardeau, Caruthersville and Mountaineer expand the strategic diversity of Century Casinos with attractive assets in strong, stable markets. The expected increase to our free cash flow will allow us to remain well positioned to reduce leverage and evaluate additional strategic growth opportunities.”

His colleague, Peter Hoetzinger, said himself that this business venture will transform Century into a premier operator on the continent.

He said these assets will compliment Century Casino’s expertise in operating small to mid-sized casinos and are very pleased to team up with Vici Properties in structuring this venture in an immediately accretive manner.

Source:

“Century and Vici enter $385m Eldorado agreement”, casinobeats.com, June 17, 2019.