3 days ago
Genting Malaysia's Empire Resorts to dispose of non-gaming assets in New York for RM2.2bil in lease deal
KUALA LUMPUR: Genting Malaysia Bhd has announced that its New York arm, Empire Resorts Inc, is disposing of its non-gaming assets to Sullivan County in New York for US$525mil (about RM2.2bil).
The Malaysian conglomerate said the disposal will include the 332-room Resorts World Catskills (RWC) hotel, 99-room Alder Hotel, 18-hole Monster Golf Course, 2,500-seat RWV Epicenter, as well as as multiple restaurants to Sullivan County Resort Facilities Local Development Corporation (SCRFLDC).
Empire will subsequently enter into a land lease with SCRFLDC for all the land under the non-gaming assets through Feb 15, 2066. It will also enter into a 20-year management agreement, inclusive of automatic renewal for two successive five-year periods, to manage all the non-gaming assets.
With the proceeds of the proposed disposal, Empire will purchase 1,554.6 acres of land from New York-listed real estate investment trust EPR Properties for US$201.3mil (RM848.1mil).
According to Genting Malaysia, purchasing the land will strengthen its asset base and give it long-term control over the 420 acres on which RWC's gaming and non-gaming assets are built. Meanwhile, there is development potential on the remaining 1,134.6 acres of vacant land.
Empire will also be utilising the proceeds of the proposed disposal to redeem US$300mil (RM1.3bil) in 7.75% senior unsecured notes due on Nov 1, 2026.
"The proceeds from the proposed disposal will enable Empire to fully redeem the Empire Bond, resulting in Empire being debt-free. This allows Empire to continue its focus on improving operating performance and realising its full potential," said Genting Malaysia.
It is anticipated that the proposed disposal will generate surplus cash of approximately US$10mil (about RM42.1mil) to Empire for general working capital purposes.
