Genting Malaysia said Thursday morning that it has reached an agreement to sell its near 16-acres of land in Miami, Florida for US$1.23 billion.

According to details contained within a Bursa Malaysia filing, Genting Malaysia’s wholly-owned subsidiary, Resorts World Miami LLC, entered into a conditional sale and purchase agreement on 26 April with a group called Smart Miami City LLC, who will acquire four parcels of land measuring a combined 15.47 acres in total. Completion of the sale is dependent upon approvals from shareholders and Miami-Dade County.

As previously reported by IAG, the proceeds are expected to be used by Genting Malaysia to expand its current slots-only Resorts World New York City casino should it win one of three full casino licenses to be granted in New York this year. A full license which would allow for the addition of gaming tables.

In a note, Nomura analysts Tushar Mohata and Alpa Aggarwal said the sale was a “very positive development” for the company and its parent, Genting Bhd.

“The original cost of investment in 2011 was US$259 million, and the carrying value as of now is US$255 million, implying Genting Malaysia would gain US$966 million if the planned purchase materializes,” they wrote.

“This is a large windfall for the company, in our view, and will help improve the balance sheet for both Genting Malaysia and Genting after years of capex, COVID-19 related slowdown and generous dividends, which have resulted in its net debt-to-equity rising from 19% as of end-2019 to 71% as of end-2022. A rough calculation shows that Genting Malaysia’s net debt to equity will fall back sharply to 21% post the sale.

“We believe the cash proceeds are likely to be retained within the company for the time being to help fund the down-state New York gaming license capex, should Genting Malaysia be successful in the bidding process. We expect the license award timeline in 1Q24.”

Genting still owns the Hilton Miami Downtown hotel and connected Omni Center but had hoped to develop a large-scale integrated resort, Resorts World Miami, on the parcel of land in question.

However, hopes that Florida might push through new gambling legislation to allow such a development were never realized and it was considered unlikely any such legislation might happen in the foreseeable future.

https://www.asgam.com/index.php/2023/04/27/genting-malaysia-reaches-agreement-to-sell-miami-land-parcel-for-us1-23-billion/