MGM Resorts chairman says group ‘excited’ to remain a standalone as People Inc drops takeover bid

MGM Resorts International, the United States-based parent of Macau casino concessionaire MGM China Holdings Ltd, says it will continue as a “standalone company” after conglomerate People Inc withdrew its proposal to acquire all public shares of MGM Resorts it didn’t already own, and take the casino group private. The June 1 takeover offer had valued MGM Resorts’ shares at a premium to their current market price. Reuters and other business news outlets had said the proposal – which had been under negotiation across four months – had valued MGM Resorts at more than US$18 billion, including debt. Paul Salem, MGM Resorts chairman, was cited saying in a Wednesday statement: “The board remains excited to continue to lead MGM Resorts as a standalone company.” That had followed negotiations by a special board committee over “several months… to advance the interests” of MGM Resorts shareholders, stated Mr Salem. He added, referring to the group’s presence in the Nevada market and the wider U.S. gaming market, as well as to its online gaming operation: “Our leading position in Las Vegas, our best-in-class regional properties, and BetMGM’s continued momentum highlight the value we bring to our shareholders.” Mr Salem further noted, referring respectively to Macau and to the group’s under-construction JPY1.51-trillion (US$9.54-billion currently) casino resort in Japan, being developed with local partners and due to open in 2030: “Our international portfolio of MGM China and the significant opportunity ahead with MGM Osaka support a clear path to increasing shareholder value.” MGM Resorts’ shares closed at US$37.85 on Wednesday trading in the U.S. The People Inc proposal in June had offered US$48.30 per share, i.e., 27.6 percent above Wednesday’s closing price. A statement from Barry Diller, People Inc’s chairman and senior executive, said: “There are lots of ingredients that go into a proposal of this kind on its way to completion. “We didn’t feel the mix was coming together in the way we had hoped and have decided not to pursue taking the company private at this time.” Mr Diller added: “What is undimmed is our belief in the future of MGM Resorts. We continue to hold 66.8 million shares representing approximately 27 percent of MGM Resorts and have total confidence in both the management and the company’s prospects.” The entrepreneur further noted, referring to MGM Resorts’ negotiating team: “I want to thank the special committee and all the MGM directors for giving us the time and consideration during the process. “People Inc is doing just fine with its principal publishing business achieving its 11th quarter of growth with plenty of cash to both invest in its business and purchase its stock.”