Melco Resorts & Entertainment has agreed to acquire certain trademarks and other intellectual property rights from its parent, Melco International Development Limited, for $375 million, a move aimed at securing full brand control while maintaining plans to resume dividends by the end of 2026, the company said in a filing and during its first-quarter earnings call.
The transaction involves the purchase of a subsidiary that owns the licensed trademarks, as well as other related intellectual property, domain names and rights previously used in Melco’s operations. The deal includes an initial payment of $300 million at signing, with the remaining balance due at closing.
The acquisition replaces an existing 10-year trademark licensing agreement that began on January 1st, 2024, under which Melco paid recurring fees. The first-quarter 2026 license fee totaled approximately $13.4 million, implying a purchase price of just under seven times the annualized fee, according to management.
Chairman and CEO Lawrence Ho said the purchase provides “full control of the IP” and allows the company to expand its brand “without any incremental cost.”
Chief Financial Officer Geoffrey Davis added that the transaction would result in “an immediate increase in EBITDA and cash flow,” as it eliminates ongoing royalty payments.
The acquisition was approved by independent members of the company’s Audit and Risk Committee, with support from an external valuation firm. Funding will come from a mix of internal resources and a credit facility drawdown, with management stating the additional debt will have a limited impact on leverage. Debt-to-EBITDA is expected to increase by less than half a turn, with levels projected to return to first-quarter 2026 levels before the end of 2026.
Dividend outlook remains intact
Despite the capital outlay, Melco said it remains committed to reinstating dividends.
“All things being equal, we would definitely like to resume the dividend by year-end,” Davis said, noting that timing will depend on factors including share price performance and broader capital allocation priorities.
The company has also continued share repurchases, buying back approximately $14 million worth of shares year-to-date, and recently approved a new $500 million buyback program, bringing total authorization to $710 million.
Retail revamp and REM hotel launch
Separately, Melco confirmed progress on several operational initiatives in Macau, including a retail overhaul at City of Dreams and the upcoming launch of its new REM hotel tower.
Ho said the REM project is “on track” for a phased opening in the early third quarter of 2026 and is expected to “represent a meaningful enhancement” to the group’s product offering.
The property will feature 149 rooms, primarily focused on one-bedroom suites, and is expected to add approximately $30,000 to $40,000 per day in operating expenses once opened.
Meanwhile, the company has begun a phased refurbishment of its retail areas at City of Dreams, which is expected to take 10 to 12 months. President Evan Winkler said the works would be carried out “zone by zone” with efforts to minimize disruption during the process.
Management indicated that both initiatives form part of a broader effort to enhance product quality and strengthen competitiveness in Macau’s integrated resort market.
