Big layoffs not planned if merger goes through

Wednesday, Feb. 23, 2000 | 11:26 a.m.

Although a merger between MGM Grand and Mirage Resorts would combine two of the largest employers in Las Vegas, a top MGM Grand official today hinted that there wouldn't be heavy layoffs if the companies merge.

"The most exciting opportunities we can see that accrue from a combination of our two companies are revenue enhancements," said Jim Murren, president and chief financial officer of MGM Grand. "We're a growth company, and we're growing rapidly in our own right. In combination, we'll grow better.

"Our focus is on revenues. Cost savings accrue from combined purchasing and financial might."

MGM Grand employs more than 14,000 people in its properties in Las Vegas and Primm, while Mirage Resorts employs about 25,000 people in Las Vegas.

An industry analyst said he believed there will inevitably be some layoffs, but that they probably wouldn't be extensive. Even before this announcement, the MGM Grand hotel-casino and Bellagio hotel-casino have been cutting back on staff in an attempt to become more efficient, said Joe Coccimiglio, analyst with Prudential Securities.

"I think there could be some redundancies, but ... it may not be all that significant," Coccimiglio said. "It's more on the marketing side, where they have offices overseas ... that's where you could see substantial savings."

Most of the cutbacks would probably be at the corporate level, rather than in property operations, Coccimiglio said.

Still, what will eventually happen remains unknown at this early stage.

"We haven't gotten into specifics," Murren said. "So for the cost savings ... I can't be specific. But our focus is on the revenue enhancement."