By Dean Seal
Prison operator CoreCivic said it completed the sale of two detention facilities in California to the U.S. government for $1.5 billion.
The company said Monday that the sales of its California City Facility and Otay Mesa Facility to the Department of Homeland Security should net it about $1.1 billion after federal and state income taxes.
Proceeds will be used in part to pay off outstanding debt, CoreCivic said. Remaining proceeds will be used for general corporate purposes, including potential share repurchases.
CoreCivic expects it will continue to manage the facilities under existing management contracts with Immigration and Customs Enforcement.
The California City Facility contract expires in August 2027 and the Otay Mesa Facility contract expires in December 2029, with a five-year extension option. ICE has the ability to terminate those management contracts, CoreCivic said.
Write to Dean Seal at dean.seal@wsj.com