Mirage rejects MGM Grand takeover offer, leaves door open for talks

Tuesday, Feb. 29, 2000 | 3:11 a.m.

Mirage Resorts Inc.'s board on Tuesday rejected MGM Grand Inc.'s $5.4 billion bid for the company, calling MGM Grand's offer of $17 per share "inadequate and not in the best interests of Mirage Resorts shareholders."

However, Mirage Resorts left the door open for talks between the companies or perhaps another suitor, saying it would "consider a transaction which would fairly reflect the long-term values inherent in the Mirage properties, brand name and good will."

The company noted that the MGM Grand offer came during a low point for the stocks of gaming companies, and branded MGM Grand's bid as an "opportunistic bid which is timed to maximize values for the bidder."

In a move apparently designed to ward off a hostile takeover attempt by MGM Grand, Mirage Resorts also said it adopted a "poison pill" provision. The provision, designed to make a hostile takeover attempt far more expensive for a rival, would go into effect if any shareholder acquired more than 10 percent of Mirage Resorts' stock, or initiated a tender offer for the company's shares.

In announcing its offer, MGM Grand said neither the company nor controlling shareholder Kirk Kerkorian held any shares in Mirage Resorts.