Blackstone in talks to buy casinos

NEW YORK/LOS ANGELES • Blackstone Group Inc. is in talks to buy and lease back the Bellagio and MGM Grand Las Vegas casinos from MGM Resorts International, according to people with knowledge of the matter.

They have yet to agree on a transaction and one may not be reached, said the people, who requested anonymity. The terms of the potential deal couldn’t be learned. Representatives for Blackstone and MGM Resorts declined to comment.

MGM Resorts has been exploring selling and leasing back the properties individually or together, Bloomberg News reported in July.

Property sales free up cash for casino companies to expand while letting them manage their resorts.

The Las Vegas-based company in January formed a committee to evaluate ways to extract value from its real estate portfolio. Activist investor Starboard Value built a position in the company with plans to push for changes, Bloomberg News reported that month. MGM Resorts expects to share the results of the review in early fall, Chief Executive Jim Murren said in July.

MGM Resorts could receive proceeds of up to US$4 billion selling the Bellagio and nearly US$3 billion from a sale of MGM Grand, analysts with Bloomberg Intelligence said in July.

Blackstone has a history in the gaming sector. It’s holdings include Spain’s Cirsa Gaming Corp., which it acquired for about US$1.8 billion, and the Cosmopolitan of Las Vegas, which it acquired for US$1.7 billion.