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Goodwill and Other Intangible Assets
12 Months Ended
Dec. 31, 2020
Goodwill And Intangible Assets Disclosure [Abstract]  
Goodwill and Other Intangible Assets

NOTE 7 — GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill and other intangible assets consisted of the following:  

 

 

 

December 31,

 

 

 

2020

 

 

2019

 

 

 

(In thousands)

 

Goodwill

 

$

2,091,278

 

 

$

2,084,564

 

 

 

 

 

 

 

 

 

 

Indefinite-lived intangible assets:

 

 

 

 

 

 

 

 

Detroit development rights

 

$

98,098

 

 

$

98,098

 

MGM Northfield Park and Empire City racing and gaming licenses

 

 

280,000

 

 

 

280,000

 

Trademarks and other

 

 

299,238

 

 

 

300,212

 

Total indefinite-lived intangible assets

 

 

677,336

 

 

 

678,310

 

Finite-lived intangible assets:

 

 

 

 

 

 

 

 

MGM Grand Paradise gaming subconcession

 

 

4,541,990

 

 

 

4,519,558

 

Less: Accumulated amortization

 

 

(1,697,481

)

 

 

(1,514,772

)

 

 

 

2,844,509

 

 

 

3,004,786

 

MGM National Harbor and MGM Springfield gaming licenses

 

 

106,600

 

 

 

106,600

 

Less: Accumulated amortization

 

 

(19,102

)

 

 

(11,996

)

 

 

 

87,498

 

 

 

94,604

 

Other finite-lived intangible assets

 

 

60,649

 

 

 

79,197

 

Less: Accumulated amortization

 

 

(26,244

)

 

 

(30,393

)

 

 

 

34,405

 

 

 

48,804

 

Total finite-lived intangible assets, net

 

 

2,966,412

 

 

 

3,148,194

 

Total other intangible assets, net

 

$

3,643,748

 

 

$

3,826,504

 

 

Goodwill. A summary of changes in the Company’s goodwill by reportable segment is as follows for 2020 and 2019:

 

 

 

2020

 

 

 

Balance at January 1

 

 

Acquisitions

 

 

Reclassifications

 

 

Currency exchange

 

 

Balance at December 31

 

 

 

(In thousands)

 

Goodwill, net by segment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Las Vegas Strip Resorts

 

$

30,452

 

 

$

 

 

$

 

 

$

 

 

$

30,452

 

Regional Operations

 

 

701,463

 

 

 

 

 

 

 

 

 

 

 

 

701,463

 

MGM China

 

 

1,352,649

 

 

 

 

 

 

 

 

 

6,714

 

 

 

1,359,363

 

 

 

$

2,084,564

 

 

$

 

 

$

 

 

$

6,714

 

 

$

2,091,278

 

 

 

 

2019

 

 

 

Balance at January 1

 

 

Acquisitions

 

 

Reclassifications

 

 

Currency exchange

 

 

Balance at December 31

 

 

 

(In thousands)

 

Goodwill, net by segment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Las Vegas Strip Resorts

 

$

70,975

 

 

$

 

 

$

(40,523

)

 

$

 

 

$

30,452

 

Regional Operations

 

 

386,892

 

 

 

256,133

 

 

 

58,438

 

 

 

 

 

 

701,463

 

MGM China

 

 

1,345,610

 

 

 

 

 

 

 

 

 

7,039

 

 

 

1,352,649

 

Corporate and other

 

 

17,915

 

 

 

 

 

 

(17,915

)

 

 

 

 

 

 

 

 

$

1,821,392

 

 

$

256,133

 

 

$

 

 

$

7,039

 

 

$

2,084,564

 

 

Goodwill was recognized in 2019 related to the acquisition of Empire City, which is included in Regional Operations, as further discussed in Note 4.

 

The goodwill balance attributable to MGM Northfield Park, which was previously included within Corporate and other in 2018, was reclassed to Regional Operations in 2019 in connection with the Company’s acquisition of the membership interests of Northfield in 2019 as further discussed in Note 4. The presentation of the goodwill balance attributable to Gold Strike Tunica was reclassified in 2019 from Las Vegas Strip Resorts to Regional Operations.

 

MGM Grand Paradise gaming subconcession. Pursuant to the agreement dated June 19, 2004 between MGM Grand Paradise and Sociedade de Jogos de Macau, S.A. (“SJMSA”), a gaming subconcession was acquired by MGM Grand Paradise for the right to operate casino games of chance and other casino games for a period of 15 years commencing on April 20, 2005. In March 2019, MGM Grand Paradise and SJMSA entered into a Subconcession Extension Contract (the “Extension Agreement”), pursuant to which the gaming subconcession was extended to June 26, 2022, which coincides with the current expiration of all the other concessionaires and subconcessionaires. MGM Grand Paradise paid the government of Macau approximately $25 million and paid SJMSA approximately $2 million as a contract premium for such extension. The Company cannot provide any assurance that the gaming subconcession will be extended beyond the current terms; however, management believes that the gaming subconcession will be extended, given that the Cotai land concession agreement with the government extends significantly beyond the gaming subconcession. As such, as of December 31, 2020, the Company amortizes the gaming subconcession intangible asset on a straight-line basis over the initial term of the Cotai land concession, ending in January 2038.

MGM National Harbor and MGM Springfield gaming licenses. The license fee paid to the State of Maryland of $22 million is considered a finite-lived intangible asset that is amortized on a straight-line basis over a period of its initial term of 15 years, beginning in December 2016, when MGM National Harbor started operations. The license fee paid to the State of Massachusetts of $85 million is considered a finite-lived intangible asset that is amortized over a period of 15 years, beginning in August 2018, when MGM Springfield started operations.

Total amortization expense related to intangible assets was $194 million, $192 million and $176 million for 2020, 2019, and 2018, respectively. As of December 31, 2020, estimated future amortization is as follows:

 

 

 

 

 

 

Years ending December 31,

 

(In thousands)

 

2021

 

$

197,104

 

2022

 

 

190,981

 

2023

 

 

178,672

 

2024

 

 

176,685

 

2025

 

 

174,900

 

Thereafter

 

 

2,048,070

 

 

 

$

2,966,412