MGM Growth Properties Raises More Than $1B in IPO Debut

NEW YORK—Las Vegas-based MGM Growth Properties (MGP), which had been a subsidiary of MGM Resorts International (MGM) and invests in casinos and resorts, raised $1.05 billion in its initial public offering Wednesday, according to The Wall Street Journal.

The REIT priced 50 million shares at $21 per share, at the high end of its target range. It offered underwriters the option to buy up to 7.5 million additional shares.

Shares jumped 5.5% to $22.16 in afternoon trading. Its stock is trading under the ticker symbol “MGP” on the New York Stock Exchange.

The proceeds of the offering will be used by MGP to purchase operating partnership units in a newly formed operating partnership that will acquire the real estate associated with Las Vegas properties Mandalay Bay, The Mirage, New York-New York, Luxor, Monte Carlo, Excalibur and The Park, as well as MGM Grand Detroit, Beau Rivage and Gold Strike Tunica from MGM. MGM will hold a 76% economic interest in the operating partnership (73% if the underwriters’ option is exercised in full) and will hold the single Class B share of MGP, which represents a majority of the total voting power of MGP’s shares, according to a regulatory filing.

BofA Merrill Lynch, J.P. Morgan, Morgan Stanley and Evercore ISI are acting as joint lead book-running managers in the proposed offering by MGP. Barclays, Citigroup and Deutsche Bank Securities are also acting as book-running managers in the proposed offering. BNP Paribas, Fifth Third Securities, SMBC Nikko, SunTrust Robinson Humphrey, Credit Agricole CIB, Union Gaming, Scotiabank and Oppenheimer & Co. Inc. are acting as co-managers in the proposed offering.