Browse articles by topic

VICI shareholders approve share issue for MGM Growth Properties acquisition


Vici Properties’ shareholders have approved the proposal to issue VICI common stock in preparation for the company’s acquisition of MGM Growth Properties (MGP).

99.9% of shareholders voted in favour of issuing the shares to MGP Class A stockholders as consideration in the merger, during a meeting called specially for the vote.

VICI – which was spun off of Caesars Entertainment and owns many properties operated by Caesars – first announced its intentions to buy MGP – itself spun off of MGM Resorts – in August in a $17.2bn deal.

The deal is expected to be completed in the first half of 2022, subject to closing conditions being met and regularly approval being granted.

MGP Class A shareholders will receive 1.366 shares of newly issued VICI common stock in exchange for each Class A share of MGP.

VICI believe the merger would bring the combined entity’s enterprise value to $45bn, which would make the new business the largest “experiential REIT (Real Estate Investment Trust)” in the US.

When the deal closes, VICI will then enter into a new master lease agreement with MGM for the MGM properties it will own, such as the Mirage and Park MGM.

The new lease agreement will have a total annual rent of $860M – accounting for MGP’s upcoming acquisition of MGM Springfield – and an initial term of 25 years, with three 10-year tenant renewal options.

Rent will increase at a rate of 2.0% per year for the first 10 years and between 2% and 3% thereafter, depending on inflation.