Casino real estate investment trust MGM Growth Properties LLC redeemed about 23.5 million operating partnership units of gaming operator MGM Resorts International for $700 million.
The redemption price represents the remaining amount under a cash deal for the REIT to buy up to $1.4 billion of MGM Resorts' units.
Upon closing, MGM Resorts will have roughly 149 million units, or a 53% economic ownership in MGM Growth. The gaming company will also maintain significant real estate holdings, including a stake in MGM Springfield in Massachusetts, a 50% interest in CityCenter in Las Vegas and a 56% interest in MGM China Holdings Ltd.
MGM Resorts aims to use the proceeds for general corporate purposes.
In a release, MGM Resorts President and CEO Bill Hornbuckle said the deal should help his company continue to pursue its strategic goals as it navigates the impact of the pandemic on the operations of its properties across the U.S., while MGM Growth CEO James Stewart said he expects the redemption to be single-digit accretive to the company's adjusted funds from operations per share.