Maloofs give up controlling interest in Palms casino hotel
Sacramento Bee reports:
The owners of the Sacramento Kings have surrendered controlling interest in their Las Vegas casino, in a deal that they say improves their finances considerably.
After months of negotiations, the Maloof family announced Tuesday that it has reached a “recapitalization” agreement with the Palms Casino’s main creditors, investment firms TPG Capital and Leonard Green & Partners.
Co-owner George Maloof said the deal erases the Palms’ debt but leaves the family, which built the trendy casino a decade ago, with less than 50 percent of the equity. That gives controlling interest to TPG and Green.
But Maloof, who enjoys a high profile in Las Vegas, said he will continue to run the Palms. He said “it’s not disappointing at all” that controlling interest has passed to the creditors.
The deal could have significant implications for the Kings at a crucial time in the team’s history. The Kings passed up an opportunity last month to move to Anaheim, agreeing to give Sacramento a last chance to build a new arena. City officials and the NBA expect the Maloofs to contribute to the project, but the amount remains to be seen
Re: Maloofs give up controlling interest in Palms casino hotel
The Maloof family will soon own just 2 percent of the Palms Casino, its trendy Las Vegas property, according to regulatory documents filed in Nevada. The revelation comes just days after George Maloof, who runs the resort and is a co-owner of the Sacramento Kings, confirmed that his family had given up majority control of the casino and hotel, on which it spent about half a billion dollars over the past decade. At the time, he would not specify the size of the family's remaining ownership stake. sacramento Bee
In an interview late Thursday, Maloof said the family could regain a more significant share – up to 20 percent – under buyback options granted by the creditors who are taking control. The Maloofs' stake in the Palms has direct relevance to its stewardship of the Kings. While the two are operated as separate companies, the Maloofs' overall financial health affects how much money the family can plow into the Kings as the team enters a crucial offseason. sacramento Bee
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