State-owned Dubai World will pay $84 each for 28.4 million shares of MGM, 13 per cent more than Tuesday’s closing price. It will invest $2.7 billion for the stake in MGM’s CityCentre hotel- and-casino project in Las Vegas, the companies said. The stock jumped 9.3 per cent in early trading in New York.
Dubai will purchase half the stake from the company and half from other investors via a public tender. The $84-a-share offer is 13 per cent more than the stock’s closing price on Tuesday.
More advantages
“Dubai World’s proficiency in real estate, combined with our company’s operational expertise, strong brands and world-renowned resorts, creates competitive advantages that we believe will benefit all of our stakeholders,” MGM Chief Executive Officer Terry Lanni said in a statement. MGM owns the Mirage, Luxor and Bellagio among its properties on the Las Vegas Strip. MGM’s Strip hotels were 97 per cent occupied, the most since 2000, and it sold $1.4 billion of condominiums at the $7.4 billion Project City Centre, set to open in 2009, it said on August 2.
