VICI Properties Selling Stock to Fund Venetian Purchase, Reduce Debt

VICI Properties (NYSE:VICI) stock up is sliding inward too soon trading Thursday after the gaming real land investiture cartel (REIT) said it’s selling up to 115 jillion shares to rear capital.

The possessor of Caesars Palace revealed the offer up later(a) Wednesday, sparking a sell-off in the gillyflower that’s carrying o'er today. In too soon trading, shares of the existent estate troupe are cancelled almost tercet percent. That’s a typical reaction to news of a percentage sale, because those offerings thin current investors. Additionally, while VICI didn’t bring up pricing for the transaction, secondary equity sales usually come at prices to a lower place market value.

VICI is issuing 50 1000000 shares of inventory to underwriters Lewis Henry Morgan Stanley, Citigroup, J.P. Morgan, and Goldman Sachs, and that those banks will purchase another 50 billion shares through and through a series of forwards cut-rate sale agreements. The syndicate of banks also has a 30-day window inward which it can purchase another 15 million shares of the cassino landlord.

Shares of VICI are upwardly 24.55 percent year-to-date, trailing the MSCI US Investable Market Real Estate 25/50 Index by almost 520 foundation points.

VICI Raising Cash for Good Causes

Of the initial 100 meg shares being sold, VICI is receiving proceeds on half that amount. Assuming a sale terms of $30 per portion – not far from where the stockpile currently resides — the REIT would elevate $1.5 one thousand million in 144 proceeds, and it has just uses for that capital.

VICI expects to enjoyment the meshwork proceeds from the cut-rate sale of shares of our unwashed gunstock and expected immediate payment proceeds received upon total physical closure of the forrard sale agreements to compensate down feather stream indebtedness and for a portion of the purchase price of the previously announced acquisition of the Venetian,” said the society in a statement.

In March, the real demesne companionship partnered with buck private equity firmly Phoebus Apollo Global Management (NYSE:APO) to gain Venetian, Palazzo and Sands Expo and Convention Center from Las Vegas Sands (NYSE:LVS) for $6.25 billion. VICI is shelling come out $4 billion for the attribute assets.

At the terminate of the sec quarter, the REIT had $7.07 1000000000 in debt and liabilities of $7.48 billion, according to Dow Inigo Jones data.

VICI Stock Still Has Catalysts

While VICI is predictably sagging on tidings of the percentage sale, it’s allay a catalyst-rich nominate among existent land equities.

Last month, the gaming landlord said it’s acquiring rival MGM Growth Properties for $17.2 billion in stockpile — a dealings creating the largest owner of Las Vegas Strip cassino existent estate. VICI is taking on $5.7 one thousand million inwards MGP debt in that deal. When the acquisition is completed, the vendee will hold an go-ahead note value of $45 billion.

VICI currently owns the holding assets of 28 gaming venues with its tenant roster, including Caesars Entertainment, Century Casinos, and Penn National Gaming, among others.

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