Casino resort operator MGM Mirage and government investment holding company Dubai World announced Wednesday they will launch a cash tender offer to repurchase up to 10 million MGM Mirage common shares for $75 to $80 each.
In a filing with the Securities and Exchange Commission, MGM Mirage said the offer price represented a 7.2 percent to 14.3 percent premium over MGM Mirage's closing stock price of $69.98 on Tuesday. MGM Mirage has about 293.8 million shares outstanding.
Kirk Kerkorian's Tracinda Corp. owns 153.8 million of the company's shares, representing a 52.4 percent stake. Tracinda has said it won't tender any of its shares.
Dubai World, through its affiliates Infinity World (Cayman) L.P. and Infinity World Investments LLC, owns 19.5 million shares, or about a 6.7 percent stake.
MGM Mirage and Dubai World's bidder will each purchase half of all shares tendered.
Under terms of a "Dutch Auction" tender offer, MGM Mirage shareholders will be able to tender their shares within the price range based on the number of shares offered, MGM Mirage and Dubai World will choose the lowest price at which they may purchase 10 million shares.
In a statement, the company said its board, Dubai World and affiliates will make no recommendation to stockholders whether to tender shares.
MGM Mirage stock was up $2.54 in morning trading Wednesday, at $72.52.