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October 22, 2014

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MGM Mirage stock surges on corporate financing news

Updated Monday, April 6, 2009 | 2:46 p.m.

MGM Mirage stock closed up 19 percent today on news it may sell some of its casinos and could land some new corporate financing.

The morning started with Australia's Crown Ltd. saying it's not in discussions about investing in the $8.7 billion CityCenter complex under construction on the Las Vegas Strip.

Crown, controlled by businessman James Packer, responded to a story in the Wall Street Journal reporting Packer is interested in CityCenter and that Crown could participate with Colony Capital in a CityCenter investment.

"Crown is not having any discussions with MGM or Dubai World with respect to any such investment in CityCenter," Crown said in the statement.

Crown has already made investments in the Fontainebleau resort under construction on the Strip as well as in Station Casinos Inc., Harrah's Entertainment Inc. and Cannery Casino Resorts.

Last week, it was reported that Colony Capital had expressed interest in investing in CityCenter. The hotel, gaming and entertainment complex is owned by MGM Mirage and Dubai World and is seeking additional funding. Colony already has numerous gaming investments including a stake in Station Casinos.

But today, Bloomberg News, quoting a source, reported that Colony is talking about providing a secured loan to MGM Mirage. The loan would help the company refinance debt and would be secured by a casino property, Bloomberg reported. This source told the news service that an investment by Colony in CityCenter is unlikely.

Separately, the Journal reported over the weekend that MGM Mirage had hired investment bank Morgan Stanley to assist in the potential sales of its MGM Grand Detroit hotel-casino and its Beau Rivage resort in Biloxi, Miss. Those potential sales could help MGM Mirage continue to fund its CityCenter obligations and help it pay debt that is coming due.

MGM Mirage stock closed at $5.53, up 88 cents.

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