MGM Mirage to sell Primm Valley Resorts1 November 2006
LAS VEGAS, Nevada – (PRESS RELEASE) -- MGM Mirage (NYSE: MGM) and Herbst Gaming, Inc. today announced that they have entered into an agreement whereby MGM Mirage will sell its Buffalo Bill's, Primm Valley and Whiskey Pete's hotel-casinos (collectively known as "Primm Valley Resorts") located in Primm, Nevada, to Herbst Gaming, Inc. for $400 million. The transaction is subject to customary closing conditions contained in the purchase agreement, including receipt of necessary regulatory and governmental approvals. The parties anticipate the transaction to close by the end of the first quarter of 2007.
Upon successful completion of the transaction, MGM Mirage expects to report a substantial gain. MGM Mirage acquired these properties in March 1999 as part of its acquisition of Primadonna Resorts, Inc.
Primm Valley Resorts, located about 40 miles south of Las Vegas, feature 2,644 guest rooms, 136,000 square feet of casino space, 2,900 slot machines and 98 gaming tables and also include three gas stations and a convenience store. The Primm Valley Golf Club, consisting of approximately 573 acres in California, is not part of this transaction and will continue to be owned and operated by MGM Mirage.
"My brothers and I are extremely pleased about the acquisition of these three great assets. We look forward to continuing and building upon the legacy started at these properties by the Primm family. We believe that the Buffalo Bill's, Primm Valley and Whiskey Pete's assets and their customer base fit in extremely well with our existing eight casino portfolio and that the 'Terrible's' brand will bring added excitement to the I-15 corridor," said Ed Herbst, President of Herbst Gaming. "We are also excited to welcome all of the great Primm Valley Resorts employees to the Herbst Gaming family."
Lehman Brothers and Wachovia Securities served as financial advisors to Herbst Gaming and Gibson Dunn and Crutcher LLP acted as legal counsel.