Las Vegas Sands Corporation, the upscale resort and casino company founded by the late Sheldon Adelson, is leaving its namesake city and selling two flagship properties in a US$6.25 billion (A$8.1bn) deal.
Sands, the most valuable gaming company in the world, has sold its Las Vegas properties—the Venetian Resort and the Sands Expo Convention Centre, to private equity firm Apollo Global Management.
The resort includes more than 7,000 guest rooms, 21,000sq m of gaming space and 210,000sq m of conference space.
The casino operator, which will remain headquartered in Las Vegas, flagged the potential sale in October, three months before the death of founder Adelson.
Las Vegas Sands chief executive Robert Goldstein said the business, which will shorten its name to Sands as a result of leaving Las Vegas, remained focused on growth and was actively on the lookout for opportunities on a variety of fronts.
“Asia remains the backbone of this company and our developments in Macao and Singapore are the centre of our attention.
“There are also potential development opportunities domestically, where we believe significant capital investment will provide a substantial benefit to those jurisdictions while also producing very strong returns for the company,” Goldstein said.
Las Vegas Sands, which suspended dividends last year as Covid-19 hit, reported a loss of US$1.69 billion across 2020, the biggest in its history.
The deal with Apollo represents 12.8 times the earnings reported in 2019 from the Las Vegas properties before interest, taxes, and depreciation after it’s cash and short-term investments halved to US$2.12 billion (A$2.75bn) in 2020 compared to the year prior.
While the global health crisis wasn't directly cited as a reason for the sale it follows the company posting a quarterly loss of almost US$300 million (A$390m) in January.
“The property is a best-in-class asset with a talented team of people operating it, know I will be rooting for them,” Goldstein said.
“I am confident Las Vegas will soon return to a more normal operating environment and The Venetian’s hardworking and dedicated team members will continue delivering a world-class experience to guests eager to enjoy it.”
One of Sands’ new projects in Asia is the US$2bn (A$2.6bn) Londoner Hotel which it hopes will win back tourists to Macau after a dramatic fall in numbers from the Covid-19 pandemic.
The resort will feature a 96-metre tall replica of Big Ben, a Crystal Palace inspired atrium and a full-scale replica of the Eros fountain once building finishes this year.
Apollo Global co-lead partner David Sambur said the firm’s bullish view on the travel recovery, following its investment in Expedia last year, had allowed it to pick up the hotel and function centre.
“We’ve been among the most active in terms of expressing a view that once people are comfortable and feel safe enough to do, they’ll resume past behaviours.
“Traditionally business travel is correlated with corporate profits and the stock market, both of which are doing quite well,” Sambur said.
Apollo Global Management Inc's affiliate-managed funds will buy the operating company of the Venetian for US$2.25 billion (A$2.92bn) and VICI Properties will buy the land and real estate assets of the Venetian for US$4 billion (A$5.1 billion).