Red Rock Resorts raised $531.4 million in its initial public offering on Tuesday, as the U.S. stock market becomes more welcoming for new flotations following months of volatility that grounded several IPO hopefuls.
Red Rock is the sixth company to go public in the United States in April, after three months of only small biotechnology IPOs. Market jitters and poor post-IPO share performances had scared investors away from buying into any sizable offerings.
Red Rock priced 27.25 million shares at $19.50, the middle of its previously indicated $18 to $21 range, according to a statement.
Red Rock, which operates resorts and casinos such as Red Rock, Green Valley Ranch and Palace Station, is the second gaming company to go public this year. Earlier this month, real estate investment trust MGM Growth Properties raised $1.05 billion in its initial public offering.
MGM Growth owns a portfolio of casino resort properties, including Mandalay Bay and the Mirage, carved out of MGM Resorts International.
While both companies have benefited from a healthier Las Vegas economy, Red Rock’s casinos cater more to locals.
Las Vegas, which was hit notably hard by the 2008 recession, has stabilized since its 2012 lows. Housing prices, which plummeted 60% from 2006 to 2012, have since rebounded.
Red Rock is primarily owned by brothers Frank and Lorenzo Fertitta, who took the company private in 2007 in a deal valued at $5.4 billion. At the time, the company operated under the name Station Casinos.
Station Casinos filed for bankruptcy in 2009, under the burden of debt from the leveraged buyout and a struggling Las Vegas economy. It emerged from bankruptcy in 2011 with the Fertitta brothers retaining control.
Proceeds from the IPO will go largely to the Fertitta family. Red Rock has total debt of roughly $2.2 billion.
Red Rock is scheduled to list its shares on Wednesday on the Nasdaq under the ticker “RRR.”
Deutsche Bank Securities, J.P Morgan, BofA Merrill Lynch and Goldman Sachs & Co are among the underwriters for the offering.