Urban One Activates Put Notice on MGM National Harbor Stake for $145.5 Million
Posted on: March 14, 2023, 11:51h.
Last updated on: March 14, 2023, 12:30h.
Media company Urban One (NASDAQ: UONE) is parting ways with its stake in MGM National Harbor after having more than tripled its investment in the Oxon Hill, Md. gaming venue.
In a Form 8-K filing with the Securities and Exchange Commission (SEC), Alfred Liggins’ company said it’s issuing a “put notice” pertaining to its entire stake in the casino.
Upon issuance of the Put Notice, no later than thirty (30) days following receipt, MGMNH is required to repurchase the Put Interest for cash. The Company expects to receive approximately $145.5 million at the time of settlement of the Put Interest, representing both the put price and receipt of the Company’s annual distribution from MGM National Harbor with respect to fiscal year 2022,” according to the regulatory document.
Based in Silver Spring, Md., Urban One owns media assets including CLEO TV, One Digital, R1 Digital, Radio One, and Reach Media, among others.
MGM National Harbor Smart Investment By Urban One
In December 2016, just days after the venue opened, Urban One landed approval from the Maryland State Lottery and Gaming Control Commission to invest $35 million in MGM National Harbor, bringing the media company’s interest in the gaming venue to $40 million.
It was a passive investment used by the media giant to diversify its business model. Over the past six years, Urban One received annual dividends based on MGM National Harbor’s net gaming revenue. During that time, MGM National Harbor became one of the dominant casinos in the mid-Atlantic region.
Further cementing the notion that Urban One made a savvy investment in the integrated resort, MGM National Harbor was the top-grossing casino in the US outside of Las Vegas last year, meaning it also beat rivals on the Atlantic City Boardwalk in revenue terms.
National Harbor is one of seven regional casinos operated by MGM. The company’s other domestic venues outside of Las Vegas are in Atlantic City, Biloxi, Miss. Detroit, Springfield, Mass., Yonkers, NY, and Ohio. VICI Properties (NYSE: VICI) owns the real estate under National Harbor and the other venues.
What Urban One Could Do with National Harbor Proceeds
In the aforementioned SEC filing, Urban One doesn’t reveal plans for the incoming proceeds from the sale of its MGM National Harbor stake.
It’s possible the media conglomerate could use some or all of that capital to continue its push for a gaming project in Richmond, Va., but that effort hit a roadblock last September when the city terminated its contract with the company.
There’s also speculation that the media entity could use the cash to acquire more radio stations as part of an effort to diversify its currently urban-centric lineup. Urban One hasn’t publicly commented to that effect.
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Source: casino.org
