Regulators tentatively OK MGM-Primadonna deal

Thursday, Feb. 25, 1999 | 9:20 a.m.

The state Gaming Control Board's recommendation Wednesday on the deal between MGM Grand and Primadonna Resorts Inc. goes to its parent state Gaming Commission for final action.

Under the agreement, Primadonna's stockholders will receive 0.33 shares of MGM common stock for each share of Primadonna held, or a total of some 9.5 million shares of MGM stock. The stock assumption deal is valued at $605 million.

Primadonna Resorts owns Whiskey Pete's, Buffalo Bill's and the Primm Valley Resort in Primm, Nev., a border town 43 miles southwest of Las Vegas, along with two championship golf courses.

MGM Grand operates the MGM Grand hotel-casino in Las Vegas, a casino in Australia and is developing a temporary casino in Detroit.

The two companies had joined together to build New York-New York, across the Las Vegas Strip from the MGM Grand. They had an agreement that either company had first right of refusal to buy out the other's 50 percent interest in the resort, which replicates the New York skyline and many of the city's landmarks.

Under the latest deal, Kirk Kerkorian and MGM end up owning 61.8 percent of MGM Grand. Gary Primm, Primadonna's chairman and CEO, has 4.7 percent, other Primm family membes have 6.3 percent and general public shareholders have 27.2 percent.