MGM Resorts (MGM) Senior VP Alan Feldman says there is nothing to the report in a New York City paper that has the L.A.-based private equity firm Leonard Green Partners backing out of an agreement to buy MGM’s 50 percent interest in the Atlantic City Borgata.
He did not address the possibility that there might have been a stumble or two along the path toward the completion of this sale that was mandated in MGM’s agreement with the Division of Gaming Enforcement.
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That may be an issue for perhaps another story, but the fact is, Feldman emphasized recently, the sale is moving through the bureaucracy and red tape associated with casino ownership in New Jersey. The other half of the Borgata is owned by Boyd Gaming (BYD), the operating partner for the entire resort. Boyd had previously said thanks but no thanks to its opportunity to exercise a right of first refusal to buy the MGM half of the hotel and casino.
Boyd executives have said they are quite happy with their present situation. This was a reaction that inspired one follower of this proposed transaction to ask a Leonard Green principal, “So why do you want to own just half of the Borgata?”
The response: “Who says we only want to own half?”
It was the kind of response that clearly suggests the L.A. company, which has been closely studying gaming investment opportunities, may not be through shopping in Atlantic City.
As for the Borgata, some gaming executives with their fingers on the pulse of deal-making interests can see Boyd selling its half of what is the city’s newest resort as it perhaps retains an operating agreement.