MGM Mirage Shares Up As Dubai World Extends Tender Offer

Shares of MGM Mirage rose to a new 52-week high today (Tuesday) as a J.P. Morgan Securities Inc. analyst said the casino operator is likely to receive a higher tender offer in the next two weeks.

MGM's stock gained nearly 4 percent, to $88.64 in afternoon trading.

The stock hit a fresh high of $89 earlier in the session.

Earlier in the day Infinity World Investments LLC, a subsidiary of holding company Dubai World, said it was extending its cash tender offer for MGM's stock until October 5th.

Infinity is offering to buy up to 14.2 million MGM Mirage shares for $84 each. MGM has about 284.3 million shares outstanding.

Analyst Harry Curtis said in a client note that Dubai World will probably raise its tender offer, as only about 730,000 shares have been tendered to date.

Between the tender offer and an agreement to buy an additional 14.2 million newly issued MGM shares at the same price, Dubai World would have an approximate 9.5 percent stake in the Las Vegas-based casino operator.

Curtis anticipates Dubai World will look to increase its equity stake to 20 percent once MGM has issued the additional stock and Dubai World has completed the tender offer and received the necessary regulatory approvals.


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