Associated Press

MGM Mirage completes sale of Treasure Island

Associated Press, 03.20.09, 04:16 PM EDT

Casino operator MGM Mirage said Friday it completed the sale of its Treasure Island Hotel & Casino to Ruffin Acquisition LLC for $775 million.

Ruffin Acquisition is owned by Phil Ruffin, who previously owned the New Frontier, which he sold for $1.2 billion in July 2007. The property has since been torn down.

MGM said it received $600 million in cash and a $175 million secured note bearing interest at 10 percent payable not later than 36 months after closing.

Ruffin Acquisition has an option to repay the note on or before April 30 and receive a $20 million discount on the purchase price, the company said.

MGM added that it will likely report a substantial gain in its first quarter as a result of the deal.

Ruffin has said he plans to keep the Treasure Island's 3,200 employees and management at intact, as well as its Cirque du Soleil and pirate shows.

MGM shares fell 17 cents, or 5.3 percent, to close at $3.05 per share.

Copyright 2009 Associated Press. All rights reserved. This material may not be published broadcast, rewritten, or redistributed

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