Elgin, Ill. — Eldorado Resorts Inc. (NASDAQ: ERI), a Nevada-based casino owner and operator, has agreed to acquire the Grand Victoria Casino for $327.5 million.
The riverboat casino opened in 1994 and is moored on the Fox River in Elgin, approximately 40 miles northwest of Chicago.
Eldorado Resorts will acquire the roughly 30,000-square-foot casino from a partnership between MGM Resorts International (NYSE: MGM) and RBG LLP, a subsidiary of Hyatt. Eldorado will use proceeds from recent asset sales, cash from ongoing operations and loans from its revolving credit facility to fund the transaction, which is expected to close during the fourth quarter.
“The addition of Grand Victoria Casino will further diversify the geographic reach of our operations and includes excess contiguous acreage for potential future development,” says Gary Carano, CEO of Eldorado Resorts.
“Grand Victoria is one of the leading casinos in the Chicagoland market and is extremely well maintained, which will allow us, upon closing, to focus on enhancing the guest experience and operating results without the need to undertake capital investments,” he adds.
MGM acquired a 50 percent interest in Grand Victoria in 2005 when it acquired Mandalay Resort Group. As the seller, MGM will receive approximately $162 million in net proceeds after transaction costs.
Gaming features at Grand Victoria Casino include 1,088 slot machines, 30 table games and a 12-table poker room. The casino also features four restaurants, 7,495 square feet of meeting and banquet space, event and concert facilities, a 1,450-space parking garage and additional surface parking for 600 vehicles.
Bank of America Merrill Lynch served as financial advisor for Eldorado Resorts, and Milbank Tweed Hadley & McCloy LLP provided legal counsel for the buyer.
The stock price of Eldorado closed at $35.70 per share on Friday, April 13, up from $18.70 per share a year ago. The stock price of MGM closed at $34.40 per share on Friday, April 13, up from $27.12 per share a year age.
— Taylor Williams