Las Vegas Sands shares jumped more than 3% in premarket following news the company has reached "definitive agreements" to sell its Las Vegas property and operations (including The Venetian Resort Las Vegas and the Sands Expo and Convention Center (collectively, "The Venetian")) for approximately $6.25 billion, a company press release read.
LVS shares rose 3% in premarket on the news, up around the 66-handle. Shares in the company have surged this year on vaccine hopes and Vegas reopening.
Apollo Global Management, will acquire the Sands' Las Vegas real property and operations - it will hold "the operating assets and liabilities of the Las Vegas business for approximately $1.05 billion in cash, subject to certain post-closing adjustments, and $1.2 billion in seller financing in the form of a term loan credit and security agreement, and VICI Properties Inc., will acquire subsidiaries that hold the real estate and real estate-related assets of The Venetian for approximately $4.0 billion in cash," the press release continued.
Sands has been one of the top casino companies in Vegas. Sands executives said the late Sheldon Adelson (founder of Sands) helped propel the company to the gaming industry's top. Sands execs say the company is set to explore other options.
So where is Sands taking the money? Well, you guessed it - Asia, of course.
"Our long-held strategy of reinvesting in our Asian operations and returning capital to our shareholders will be enhanced through this transaction. Additionally, as our industry continues to evolve, particularly as it relates to the digital marketplace, we are committed to exploring those possibilities," said Patrick Dumont, the company's president and chief operating officer.
Dumont added, "Our company's history will always be traced to the opening of The Venetian in Las Vegas. Today, Sands is the most valuable gaming company in the world with an established track record of success in developing and operating large-scale integrated resorts in Asia and the United States. The company's financial strength, which grows stronger as a result of this deal, gives us the flexibility to pursue a multitude of new development opportunities."
In Asia, through its majority-owned subsidiary Sands China, the company owns several properties in Macau, including the Sands Macao, The Londoner Macao, The Venetian Macao, The Plaza Macao, and The Parisian Macao.
In short, Sands is making a pivot to Asia as Vegas could take years to recover, something we noted last June.