LAS VEGAS -- Following several rounds of negotiations, MGM Grand
announced it will be buying Mirage Resorts for $4.4 billion, a
price higher than the original $3.28 billion offer the company made
last month.
In fact, Mirage turned down that first offer, which would have
provided $17 a share. Now, at $21 a share, the "transaction fully
embraces the value of the franchise created by each of the Mirage
properties and the contribution made by the 32,000 individuals who
are responsible for that franchise," said Stephen A. Wynn,
chairman, president and chief executive officer of Mirage
Resorts
In addition, MGM Grand will assume approximately $2 billion in
outstanding debt of Mirage Resorts. Company executives expect the
deal to close in the fourth quarter of this year.
The MGM Grand-Mirage marriage will have combined revenues of
about $4 billion and properties that add up to a significant
presence on the Las Vegas Strip.
On the MGM Grand side, there's the MGM Grand Hotel and Casino
and New York-New York.
Mirage Resorts owns three megacasinos in Las Vegas -- the
newest, the Bellagio, which opened in October 1998; the Mirage, and
Treasure Island.
Mirage's newest property, though, is Beau Rivage in Biloxi,
Miss., which opened a year ago. The company also owns Golden Nugget
hotels in Las Vegas and Laughlin, Nev.
MGM Grand also has properties in Detroit and Australia and other
ventures in Nevada and South Africa.
The company's chief competitor is now Park Place Entertainment,
the Hilton spinoff that, by most measures, is the world's largest
gaming company. Park Place recently closed on its $3 billion
acquisition of the Caesars properties of Starwood Hotels &
Resorts.
Park Place's Las Vegas properties are Caesars Palace, Paris,
Bally's, the Flamingo Hilton and the Las Vegas Hilton.