Casino operator buys back shares for $100 million

Tuesday, April 1, 2003 | 9:36 a.m.

Mandalay Resort Group said Monday it will pay Bank of America Corp. $100 million for 3.26 million Mandalay shares as it settles an equity forward contract.

Mandalay said it was is buying the shares for about $30.67 each as the contract expired Monday. The Las Vegas-based company made the agreement with Bank of America in September 2000 as a way to buy back its stock without spending its own money, Mandalay President and Chief Financial Officer Glenn Schaeffer said.

Bank of America bought 6.9 million shares at a cost of $138.7 million, or about $20.10 a share in 2000. Mandalay since then bought stock from Bank of America to reduce the value of the contract to $100 million. The value of the shares under the contract has been adjusted based on Mandalay's share price to keep the value of the agreement at $100 million, Schaeffer said.

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