Hotel Transaction Nevada

Eldorado Resorts Completes Acquisition of MGM’s 50 Percent Interest in Silver Legacy Resort Casino Reno and All Assets of Circus Circus Reno

Transaction Further Expands Eldorado’s Gaming Operations to Seven Properties in Five Markets

Eldorado Resorts

Eldorado Resorts, Inc. (NASDAQ: ERI) announced today that it completed the previously announced purchase of MGM Resorts International’s (NYSE: MGM) 50 percent interest in the Silver Legacy Resort Casino Reno, as well as the assets of Circus Circus Reno, for total consideration of $72.5 million cash plus a working capital adjustment. In addition, ERI repaid the entire outstanding balance of the Silver Legacy credit facility, which amounted to approximately $52.6 million on a net debt basis. The transaction was financed with cash on hand, cash from the escrow account established at the time of the Company’s July financings and borrowings under the Company’s revolving credit facility. As a result, Eldorado has withdrawn its registration statement relating to a proposed common stock offering, the proceeds of which were intended to pay a portion of the purchase price for the Circus Circus Reno and 50% interest in the Silver Legacy joint venture.


Silver Legacy Resort Casino Reno


“The addition of Silver Legacy and Circus Circus Reno to our operations is consistent with our strategy to enhance shareholder value by pursuing strategically and economically attractive transactions,” said Gary Carano, Chairman and Chief Executive Officer of Eldorado. “We are very excited to welcome the Silver Legacy and Circus Circus Reno employees to the Eldorado family at a time when the Reno gaming market and the northern Nevada economy is prospering. Our experience integrating the MTR operations and the talent of our operating teams across Reno’s three leading downtown casino resorts will serve us well as we welcome Silver Legacy and Circus Circus Reno into our operating base.”


Tom Reeg, President of Eldorado, added, “The transaction is immediately accretive to our free cash flow and strengthens our position in the Reno market where gross gaming revenues are up more than 3.5% year-over-year through September. We expect to realize significant cost and revenue synergies with the tri-properties now under common ownership. After careful review of our financing options, we chose to fund the final piece of the transaction with existing revolver capacity, in lieu of an equity offering. Based on the continued strength of our operations, we expect that we will reach our pro forma leverage target of less than five times EBITDA in the first half of 2016.”


The transaction increases Eldorado’s property portfolio to seven wholly-owned and operated facilities in five markets with a total of approximately 10,230 slot machines and VLTs, approximately 300 table games, approximately 4,850 hotel rooms, approximately 35 dining, bar and entertainment options, three pari-mutuel racing facilities and approximately 8,000 team members.


The Silver Legacy is a Nevada mining themed hotel-casino and entertainment complex which features an approximately 89,200-square foot gaming floor with 1,302 slot machines, 63 table games, 1,711 hotel rooms, including 141 player suites, eight penthouse suites and seven hospitality suites, a 50,000 square foot convention center, a race and sports book, two fine dining restaurants, a buffet, food court and four casual dining restaurants. Circus Circus Reno is an iconic circus-themed hotel-casino and entertainment complex which features an approximately 56,000-square foot gaming floor with 908 slot machines, 33 table games, 1,571 hotel rooms, including 67 mini suites, four executive suites and four VIP suites, a sportsbook, two fine dining restaurants, a buffet and three casual dining restaurants. Circus Circus Reno also has a Midway featuring a total of 158 games and a full service wedding chapel with reception services for groups of 25 or more. Silver Legacy, Circus Circus Reno and Eldorado Reno are seamlessly connected by a 200-foot skyway corridor.


Eldorado Resorts is a casino entertainment company that owns and operates seven properties in five states, including the Eldorado Resort Casino, the Silver Legacy Resort Casino and Circus Circus in Reno, NV; the Eldorado Resort Casino in Shreveport, LA; Scioto Downs Racino in Columbus, OH; Mountaineer Casino Racetrack & Resort in Chester, WV; and Presque Isle Downs & Casino in Erie, PA.



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