MGM Resorts International has formed a special committee of its board and hired financial advisers to assess a takeover proposal from Barry Diller, whose media and internet group People Inc. already owns 26.1% of the casino operator.
The step, reported by the Wall Street Journal and attributed to people familiar with the talks, follows an offer Diller tabled on 1 June. He proposed paying $48.30 per share for the portion of MGM that People Inc. does not already control. The bid values MGM’s equity at about $12.4 billion and the wider company at more than $18 billion once debt is counted. People Inc. is the group formerly known as IAC, which Diller chairs and which built its MGM position over several years.
People close to the process say discussions accelerated this month, though they caution there is no guarantee the two sides reach a final agreement. Bankers at JPMorgan Chase are helping Diller arrange the financing needed to complete a deal of this size.
MGM has not backed the offer
MGM has made no public statement on the proposal, and people familiar with the board’s thinking say the company views $48.30 as too low for its portfolio. That reading is shared by some analysts, who have argued a fair price sits closer to $55 to $60 per share. MGM stock has traded around the offer level, settling at $48.40 in recent after-hours trading, a sign investors expect a transaction of some form but are not pricing in a large premium above Diller’s number.
The company being valued spans luxury resorts on the Las Vegas Strip, regional US casinos and international properties, alongside table games revenue and the BetMGM online betting and casino joint venture. MGM’s scale places it among the largest gaming groups by market value, a point set out in this ranking of the top iGaming operators in the Americas by market cap.
Part of a wider consolidation wave
The Diller approach lands during a run of large deals across the casino and hospitality sector. In late May, Caesars Entertainment agreed to be acquired by Fertitta Entertainment, the Golden Nugget owner controlled by Tilman Fertitta, in a transaction worth more than $17 billion including debt. That agreement followed a period of competing interest in Caesars, covered when Fertitta tabled a bid for Caesars earlier in the year.
Established operators are also weighing structural pressures on their core business. Land-based venues face competition from online prediction platforms that let users trade on the outcome of sports and events, a market examined in this analysis of how prediction markets are reshaping US sports betting. Las Vegas itself is shifting, with fewer middle-income family visitors and a heavier reliance on high-spending affluent guests.
What happens next
The outcome now rests on two questions. The first is whether Diller can lock in financing on terms that make the bid workable at or above its current level. The second is whether MGM’s special committee concludes that $48.30, or a revised figure, represents fair value for shareholders. Until the committee reports and the two sides either agree a price or walk away, the proposal remains an offer under review rather than a deal.
Source: MGM Resorts International
