Kerkorian’s Tracinda offers $55 each for 15M MGM Mirage shares
LAS VEGAS – Billionaire investor Kirk Kerkorian’s Tracinda Corp. on Wednesday said it plans to offer $55 a share in cash for up to 15 million shares of MGM Mirage Inc., boosting its stake in the owner of the Bellagio in Las Vegas and other casinos to more than 60 percent. MGM Mirage shares rose more than 10 percent in morning trading.Tracinda – which is solely owned by Kerkorian – already holds 158.4 million shares of MGM Mirage, or 56.3 percent of the company’s outstanding stock.”This tender offer demonstrates our confidence in MGM Mirage and its management and our commitment to the company’s future,” a Tracinda representative said in a statement.The tender offer, which would be worth about $825 million, amounts to an additional 5.3 percent of MGM Mirage shares and would boost Tracinda’s stake to 61.7 percent of the casino company’s outstanding stock.The offer represents a roughly 12 percent premium over MGM Mirage’s closing stock price of $49 on Tuesday.MGM Mirage stock rose $5.11, or 10.4 percent, to $54.11 in midday trading on the New York Stock Exchange after rising to a new 52-week high of $54.24 earlier in the day.MGM Mirage, the nation’s second largest casino company after Harrah’s Entertainment Inc., owns the MGM Grand, Luxor, Bellagio and other casinos in Las Vegas, as well as gaming properties in other Nevada cities and Atlantic City, N.J.Morgan Stanley analyst Celeste Brown said in a research note the tender offer did not appear to be part of a larger buyout.But she said it indicated faith in MGM’s joint venture with Pansy Ho in Macau, which will open late next year, and the $7 billion Project CityCenter on the Las Vegas Strip set to open in late 2009.”What may appear to be expensive to the market on near-term numbers could look cheap to it over the long term,” Brown said.—On the Net:MGM Mirage Inc., http://www.mgmmirage.com
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