MGM Growth talks $1.05 billion eight-year notes to yield 5¾%-6%; books close Wednesday

By Paul A. Harris

Portland, Ore., April 5 – MGM Growth Properties Operating Partnership LP talked a $1.05 billion offering of non-callable eight-year senior notes (B2/B+) to yield 5¾% to 6% on Tuesday, according to market sources.

Talk tightened from earlier guidance in the 6% area. The Rule 144A and Regulation S deal hit the market with pro forma guidance of 6% to 6¼%, a source said.

Books close at 1:30 p.m. ET on Wednesday, and the deal is expected to price thereafter.

J.P. Morgan Securities LLC, BofA Merrill Lynch, Barclays, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., BNP Paribas Securities Corp., FT and Morgan Stanley & Co. LLC are the joint bookrunners.

Proceeds, together with the proceeds from a $600 million revolving credit facility, a $300 million term loan A, a $1.85 billion term loan B and $800 million of equity will be used to repay about $4 billion of MGM Resorts debt to be assumed by the operating partnership (an MGM Growth Properties subsidiary) being formed in connection with the spinoff of MGM Resorts International's gaming properties into a real estate investment trust.

The prospective issuer is a Las Vegas-based owner and operator of gaming properties.

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