LAS VEGAS, May 31, 2016 /PRNewswire/ -- Boyd Gaming
Corporation ("Boyd Gaming") (NYSE: BYD) today announced that it has
entered into a definitive agreement to sell its 50% equity interest
in Marina District Development Holding Company, LLC, the parent
company of Borgata Hotel Casino & Spa in Atlantic City, New Jersey, to MGM Resorts
International (NYSE: MGM)for consideration of $900 million, as well as a 50% share of any
future property tax settlement benefits received by Borgata.
Boyd Gaming expects to initially receive approximately
$600 million in net cash proceeds
from the transaction, after deducting its share of Borgata's
currently outstanding debt. These initial proceeds do not
include Boyd Gaming's potential share of future property tax
settlement benefits. Borgata estimates that it is entitled to
property tax refunds totaling $180
million, including amounts due under court decisions
rendered in its favor, and estimates for open tax appeals.
Keith Smith, President and Chief
Executive Officer of Boyd Gaming, said: "The development and
opening of Borgata in 2003 was an important step in the evolution
and growth of Boyd Gaming. Under our leadership, Borgata firmly
established itself as the East Coast's most popular and successful
entertainment resort throughout the last 13 years. While we are
pleased with the performance of this property, this transaction is
an attractive opportunity to immediately unlock significant value
for our shareholders. We intend to use the proceeds to reduce debt,
further strengthening our balance sheet and accelerating the
timeline for reaching our leverage target of four to five times
debt to Adjusted EBITDA."
Smith added: "The consistent success of Borgata is a tribute to
the entire Borgata team, as they have continued to outperform an
evolving and challenging Atlantic
City market. We thank them for their tremendous
contributions to Borgata and Boyd Gaming, and we wish them
continued success as they join the MGM team."
The transaction is expected to close in the third quarter,
subject to the satisfaction of customary closing conditions and the
receipt of all required regulatory approvals. Upon closure of
the transaction, MGM will fully own the property and assume
oversight of the property's day-to-day operations.
Morrison & Foerster LLP served as legal advisor to Boyd
Gaming for the transaction.
About Boyd Gaming
Headquartered in Las Vegas,
Boyd Gaming Corporation (NYSE: BYD) is a leading diversified
owner and operator of 22 gaming entertainment properties located in
Nevada, Illinois, Indiana, Iowa, Kansas,
Louisiana, Mississippi and New Jersey. Boyd Gaming
press releases are available at www.prnewswire.com.
Additional news and information on Boyd Gaming can be found at
www.boydgaming.com.
Forward-looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of
1934, as amended. Such statements contain words such as "may,"
"will," "might," "expect," "believe," "anticipate," "could,"
"would," "estimate," "continue," "pursue," or the negative thereof
or comparable terminology, and include (without limitation)
statements regarding the transaction contemplated by the definitive
agreement, Boyd Gaming's expectations regarding the timing of
closing, the anticipated amount of the property tax refunds or
court settlements, the final purchase price, as well as the
potential benefits to be achieved from the sale of the Borgata,
including the opportunity to unlock significant value for Boyd's
shareholders, the intended use of the proceeds from the sale, and
any statements or assumptions underlying any of the foregoing.
These forward-looking statements are based upon the current beliefs
and expectations of management and involve certain risks and
uncertainties, including (without limitation) the possibility that
the transaction contemplated by the definitive agreement will not
close on the expected terms (or at all), the amount of any tax
refunds or court settlement amounts, litigation, or the
satisfaction or waiver of any of the closing conditions that could
delay or prevent the closing, and changes to the financial
conditions of the parties, or the credit markets, or the economic
conditions in the areas in which they operate. Additional factors
are discussed in "Risk Factors" in Boyd Gaming's Annual Report on
Form 10-K for the year ended December 31,
2015, and in Boyd Gaming's other current and periodic
reports filed from time to time with the Securities and Exchange
Commission. All forward-looking statements in this press release
are made as of the date hereof, based on information available to
Boyd Gaming as of the date hereof, and Boyd Gaming assumes no
obligation to update any forward-looking statement.
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SOURCE Boyd Gaming Corporation