Media mogul Barry Diller's People Inc has proposed to buy MGM Resorts in a deal valuing the casino operator at more than $18bn, marking a sharp departure from digital media for the group. The offer, announced on Monday, comes weeks after Diller told shareholders that MGM stock was 'wildly undervalued'.
People, which owns 26.1% of MGM's outstanding common stock, is offering $48.30 per share in cash for the remaining shares, a premium of about 10.6% over Friday's closing price of $43.67. MGM shares rose more than 10% in premarket trading, while People's shares gained nearly 3%.
Diller's interest in MGM dates back to the Covid-19 pandemic, when he began accumulating shares as the casino operator's stock was battered by closures and travel restrictions. MGM owns marquee properties accounting for roughly 40% of the Las Vegas Strip, but has struggled with sluggish footfall in Las Vegas, relying on growth in its China properties and digital operations.
The company's BetMGM venture has emerged as a leading US online sportsbook, offering exposure to a digital gambling market that analysts view favourably. For Diller, the move gives his group access to the travel and tourism industry amid volatile markets.
The offer marks another major takeover attempt in the casino sector, following Tilman Fertitta's $17.6bn deal for Caesars Entertainment last week. MGM Resorts did not immediately respond to a request for comment.
