Billionaire media mogul Barry Diller’s People Inc. has proposed acquiring the remaining shares of MGM Resorts International it does not already own, valuing the Las Vegas casino and resort operator at more than $18 billion in what would be the second major Strip consolidation deal in as many weeks.
People Inc. — formerly known as IAC and owner of publications including People magazine — is offering $48.30 per share in cash for the 73.9% of MGM Resorts it does not currently hold. The offer represents a 10.6% premium over MGM’s closing price of $43.67 and a 30% premium over its 90-day volume-weighted average price.
People Inc. already owns 26.1% of MGM’s outstanding stock, a stake valued at $2.9 billion, and holds two board seats, one occupied by Diller himself. If completed, People Inc. would own just over 50.1% of MGM’s equity, and current management would be expected to remain in place.
Diller cited MGM’s resilience against technological disruption as a key factor in the acquisition rationale. “We began investing in MGM nearly six years ago because we believed it represented a rare kind of business: one with real-world assets that AI cannot easily replicate or disintermediate, and exceptional digital growth opportunities,” he said in a statement. “That conviction has only strengthened over time.”
The proposed deal follows closely on the heels of Caesars Entertainment’s acquisition by Tilman Fertitta’s Fertitta Entertainment in an all-cash merger valued at approximately $17.6 billion, including roughly $11.9 billion in assumed debt. Caesars operates eight Las Vegas properties, making both deals significant consolidations of Strip real estate.
MGM Resorts owns 13 properties in Las Vegas, including the Bellagio, Aria, Luxor, Mandalay Bay and MGM Grand. The company’s shares rose more than 10% in premarket trading following the announcement, while People Inc. shares rose nearly 3%.
In an April letter to shareholders, Diller called MGM stock “wildly undervalued” and said People would sharpen its focus on the MGM stake. The company began building its position during the pandemic lockdowns of 2020, when casino stocks were trading at steep discounts. The timing proved prescient, as MGM’s stock has since recovered substantially on the strength of Las Vegas tourism and the company’s expansion into digital gaming and sports betting.
“I believe this transaction would deliver significant benefits to the shareholders of both companies,” Diller said. “MGM shareholders would be given the opportunity to de-risk their investment and realize immediate, attractive value in cash for their shares.”
