Blackstone Group Tries A Hand At The Casino Industry

Discussion in 'Stock Market Forum' started by PaulSchinider, May 17, 2014.

  1. PaulSchinider

    PaulSchinider Well-Known Member

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    Blackstone Group’s real estate arm will purchase The Cosmopolitan of Las Vegas hotel and casino from Deutsche Bank

    Deutsche Bank AG (DB) announced yesterday that it had reached an agreement with global investment and advisory firm The Blackstone Group L.P. (BX) which will see it sell The Cosmopolitan of Las Vegas hotel and casino to the latter in an all-cash deal worth around $1.73 billion. Blackstone’s real estate arm will pay for the acquisition by raising debt worth $1 billion and utilizing cash from the firm’s newest fund, Blackstone Real Estate Partners VII. Blackstone stock closed down 1.8% yesterday after the news broke.

    Deutsche Bank had bought the 8.7 acre gaming resort for $3.9 billion from its previous owner and developer, Ian Bruce Eichner, in 2008, after Eichner defaulted on his loans. The deal with Blackstone comes as Deutsche Bank increases efforts to unload its stakes in non-core operations, which the bank has placed in a special subsidiary. It wants to sell off all loss-making assets and focus on its traditional banking activities. The German lending giant had helped build and complete the Cosmopolitan, but had indicated since the hotel-casino complex opened in 2010 that it was looking to divest.



     

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