Maloofs Surrender Palms Controlling Stake

The owners of the Palms Casino Resort and the NBA’s Sacramento Kings have reached a deal that will see two investment firms become partners in the Las Vegas property.

The Maloof family announced June 14 that it had reached a recapitalization agreement with TPG Capital and Leonard Green & Partners. As part of the deal, the firms will reportedly take a controlling stake in the Palms.

Co-owner George Maloof told the Sacramento Bee the agreement erases the casino’s debt and leaves the family with the finances to contribute to a new arena project for the Kings in Sacramento.

“We’re definitely in a better position,” he said. The Maloofs’ casino business took a hit during the recession, the paper reported, and the Palms breached its loan covenants earlier this year.

The family has been pushing for replacement for the Kings’ aging PowerBalance Pavilion (formerly Arco Arena) for some time. They passed on a chance to move the team to Anaheim in May but promised that the team will leave after next season if a new arena plan isn’t in place.