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US – Eldorado takes two Reno casinos off MGM’s hands

By - 9 July 2015

MGM Resorts is offloading two of its casino assets in Reno, Nevada, to local operator and long-term partner Eldorado Resorts.

Eldorado is buying MGM Resort’s 50 per cent interest in the Silver Legacy Resort Casino Reno, as well as all of the assets of Circus Circus Reno, for total consideration of $72.5m.

Eldorado already owns the other 50 per cent interest in Silver Legacy, a Nevada mining themed hotel-casino with an 89,200-square foot gaming floor, 1,340 slot machines, 63 table games, sports book and 1,711 hotel rooms.

Circus Circus Reno is circus-themed hotel-casino with a 56,000 sq. ft. casino with 906 slot machines, 35 table games, sports book and1,571 hotel rooms.

Gary Carano, Chairman and Chief Executive Officer of Eldorado, said: “The acquisition of these well-established properties represents a significant growth and expansion opportunity for Eldorado and is consistent with our strategy to enhance shareholder value by structuring transactions that are strategically and economically attractive. The acquisition is expected to be accretive to our operating results upon closing, builds the critical mass of our gaming operations and fortifies our position in the increasingly attractive Reno gaming market.”

The proposed transaction will increase Eldorado’s property portfolio to seven wholly-owned and operated facilities in five markets with a total of approximately 10,850 slot machines and VLTs, approximately 310 table games, approximately 4,850 hotel rooms, approximately 36 dining options, three pari-mutuel racing facilities and approximately 8,600 team members.

“We greatly appreciate the hard work and dedication of our employees at Circus Circus Reno and Silver Legacy,” said Dan D’Arrigo, Executive Vice President, Chief Financial Officer and Treasurer of MGM Resorts. “MGM Resorts has enjoyed a long-standing relationship with the Carano family, who share many of the same core values as MGM. We believe that joining the Eldorado family will provide our employees with significant opportunities to grow and prosper.”

Mr. Carano added: “With the acquisition of Silver Legacy and Circus Circus Reno, we continue to execute our long-term plan for expansion. Upon completing the transaction, we will own the three leading downtown Reno casino resorts at a time when the Reno market and the surrounding region is recovering and attracting new businesses that should drive long-term economic support. I’m confident that the talent of our operating team, our understanding of the market — and long-term success in Reno — and our company-wide focus on excellence in guest service, combined with the market-leading amenities offered by Eldorado Reno, Silver Legacy and Circus Circus Reno, will position our company as a premier provider of casino gaming, entertainment, food and beverage and hospitality offerings in the Reno market.”

Tom Reeg, President of Eldorado, concluded: “This acquisition is another step toward our goal of expanding our property base and driving shareholder value. Since the acquisition of the MTR Gaming properties last September, we have made continuous progress in integrating these properties into our portfolio. Our experience in integrating MTR’s operations will serve us well as we welcome Silver Legacy and Circus Circus Reno into our operating base. With our proven management team, operating discipline and return-focused approach to capital expenditures, we believe the acquisition of Silver Legacy and Circus Circus Reno offers a meaningful opportunity for Eldorado Resorts and our shareholders.”

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