In a filing with the Securities and Exchange Commission last week, MGM Growth said it raised almost $600 million to sell 19 million shares of the company’s stock that will be used to redeem a portion of MGM’s ownership. The remaining cost will be funded through cash on the balance sheet.

MGM Resorts, which spun off MGM Growth in 2015, once owned 73% of the REIT. The company said two years ago it wanted to drop below 30% ownership. MGM Growth owns the land and real estate of eight Strip properties and 15 properties in total covering eight states, all of which are managed by MGM Resorts.

“The deal, in our view, shows MGM’s commitment to furthering its agenda to reduce its stake in MGM Growth,” Deutsche Bank gaming analyst Carlo Santarelli said in a research note. “This, in our view, feels fairly prudent, despite our more bullish view of the value inherent in MGM Growth and the triple net REIT gaming space in general.

In December, MGM Growth paid MGM Resorts $700 million to reduce the company’s ownership stake to 53%.

Truist Securities gaming analyst Barry Jonas suggested the stake is “potentially one large deal” away from falling below the 30% level. Jonas said once MGM Resorts deconsolidates from the REIT, it would remove an overhang on MGM Growth’s valuation.

MGM Growth – one of three gaming industry REITs – does not have any operating partners other than MGM Resorts. Gaming and Leisure Properties owns gaming facilities that are operated by four different partners.

VICI Properties will have six different operating partners once the $6.25 billion acquisition of the Venetian and Palazzo in Las Vegas from Las Vegas Sands closes at the end of the year.

Meanwhile, MGM Resorts’ reduced ownership stake in the REIT means the company’s annual dividend share from MGM Growth will decline. In 2020, MGM Resorts received $358 million in dividends from the REIT. Deutsche Bank estimated the dividends will decline to $237.8 million in 2021.

MGM Resorts continues to own real estate, including its ownership of MGM Springfield in Massachusetts, a 50% ownership in the Las Vegas Strip’s CityCenter development, and a 56% ownership in MGM China, which includes two resorts.

Shares of MGM Resorts closed at $38.98 Friday on the New York Stock Exchange, down 21 cents or 0.54%. MGM Growth shares closed at $33.29 on the New York Stock Exchange, up 61 cents or 1.87%.