LAS VEGAS - A holding company for the Persian Gulf state of Dubai has laid down a big marker on the Las Vegas Strip - a $5 billion investment that gives it a chunk of MGM Mirage and 50 percent of a massive entertainment complex the casino operator is building.
Dubai World will pay $2.7 billion for half of the 76-acre CityCenter complex under construction in the heart of the Strip, and buy up to $2.4 billion in MGM Mirage Inc. stock, the company said Wednesday. The investment gives Dubai its first step into Las Vegas and for MGM Mirage, removes a significant debt load from the development of the $7.4 billion CityCenter.
MGM Mirage also gets access Dubai World's rolodex of wealthy clients that could purchase the new luxury condos at the site, and at premium prices, said MGM Mirage chief executive Terry Lanni. "They are selling villas and condos to people we don't even know," Lanni said. "They're selling condominiums for four times per square foot than we are." The deal also caps a series of moves by MGM Mirage's majority shareholder, 90-year-old billionaire investor Kirk Kerkorian. In June, Kerkorian abandoned a buyout of the upscale Bellagio casino-hotel when it was learned that his MGM Mirage cut a separate deal with Kerzner International Holdings Inc. to develop 40 acres of land on the Strip. Along with acquiring 50 percent of CityCenter, Dubai World agreed to buy 14.2 million outstanding MGM Mirage shares at $84 per share, a 13 percent premium to the closing price of $74.32 on Tuesday. It would buy an additional 14.2 million newly issued shares at the same price, giving it an approximately 9.5 percent stake.
Kerkorian's stake in MGM Mirage is expected to fall to 51.65 percent from 54.15 percent.
Shares jumped Wednesday by 8.5 percent, or $6.28, to $80.60. Lanni said the deal would reduce MGM Mirage debt by about $6 billion, allowing the company will finance new projects.
Standard & Poor's Ratings Services said Wednesday it may upgrade MGM Mirage's corporate credit rating of "BB" following the news. "If a significant portion of the proceeds are used to permanently reduce debt, a one- notch upgrade of the ratings would be considered," the agency said in a statement.
MGM Mirage will remain CityCenter's developer and will be paid a healthy management fee of two percent of gross revenues from the hotel-casino and its Vdara condo-hotel. It will also claim five percent of operating profits and a flat $3 million annual fee for managing the shopping center, before its 50 percent share of the net profit is determined, Lanni said.
In addition, MGM Mirage is entitled to a $100 million bonus payment from Dubai World if the CityCenter project is finished on budget and by late 2009. More than $2.7 billion of the total $7.4 billion construction cost is already expected to be offset by the sale of condo units.
Dubai World made headlines last year when its subsidiary, Dubai Ports World, was forced to sell its U.S. port operations after an uproar in Congress over security concerns.
Dubai World this month signed an agreement for control of the Barneys New York department store. A division of Dubai World spent $100 million this year to buy the QE2, the majestic ocean liner that has carried millions of people across the Atlantic during its 40-year history. The joint venture with MGM Mirage is expected to close by the end of the year. Associated Press Writers Michelle Chapman in New York and Barbara Surk in Dubai, United Arab Emirates, contributed to this report. Forbes.com
Casinos.ch ist die Gaming & Entertainment-Plattform der Schweiz und mit über 20 Informationsportalen und rund 100 Internetnamen (Domains) das grosse News- und Pressenetzwerk der Casino- und Glücksspielszene in Europa.
Aktuelle News, Interviews, Fotos und spannende Stories - direkt und live aus den Schweizer Casinos, der Spielbankenszene Deutschlands, über das monegassische Casino von Monte Carlo, weitere Casinos aus ganz Europa und der ganzen Welt finden Sie auf www.casinos.ch. Und last but not least natürlich auch aus der Sin City 'Las Vegas'.
Die Informationen sind unterteilt in die Bereiche Casino-Informationen, aktuelle News, Events, Jackpot und Tournament-Informationen, Fotogalerien, Live-Berichte und Interviews sowie ein täglich wechselndes Glückshoroskop.
Top-Brands: - www.casinos.ch CH-Casino-Plattform - www.swisspoker.ch Poker-News - www.casinopersonal.ch offene Stellen - www.nightlife.ch Ausgangs-Informationen
Weitere Nachrichten der Gaming-Branche |
Grosses Potenzial für Energieeinsparung in der Schweizer Industrie
Bundesamt für Energie BFE, 07.10.2024Hochschule für Technik FHNW verleiht 399 Diplome
Fachhochschule Nordwestschweiz, 07.10.2024Neue Ausstellung im Textilmuseum St.Gallen: Circle of Water. Textilien im Fluss
Textilmuseum St. Gallen, 07.10.20241664 Original Lager Bier 24x50cl
CHF 21.90 statt 43.80
Coop
2 go Energy Drink Sugarfree 6x25cl
CHF 6.00
Coop
2Go Energy Drink 6x25cl
CHF 6.00
Coop
À Table! Bratpfanne Ceramic 20cm
CHF 29.95
Coop
À Table! Bratpfanne Ceramic 24cm
CHF 34.95
Coop
À Table! Bratpfanne Classic 20cm
CHF 17.95
Coop
Aktueller Jackpot: CHF 1'035'474