U.S.-based casino operator MGM Resorts International announced on Tuesday an agreement to acquire 188.1 million shares in subsidiary MGM China Holdings Ltd from minority shareholder Pansy Ho Chiu King.
“As a result of the transaction, the company will acquire an additional 4.95 percent of the outstanding ordinary common shares of MGM China and will own approximately 56 percent of MGM China’s outstanding common shares,” MGM Resorts stated in a press release.
Prior to the deal, Ms Ho held a 27.44-percent stake in MGM China, including direct and indirect interests. Once the transaction is completed, her stake will be reduced to 22.49 percent.
Macau-based casino operator MGM China currently operates only one property, the MGM Macau casino hotel (pictured) on Macau peninsula. The firm is building a US$3.1-billion casino resort in Macau’s Cotai district, scheduled to open in the second quarter of 2017.
“MGM Resorts is committed to the long term growth of Macau as a premier international tourism destination and we are pleased that we can build upon our longstanding relationship with Pansy to further work toward our mutual interests,” said the chairman and chief executive of MGM Resorts, Jim Murren, in a statement included in the press release.
As part of the agreement, MGM Resorts will issue 7.06 million of its common stock to Ms Ho and pay her a cash consideration of US$100 million. In addition, the U.S. firm will make a deferred cash payment to Ms Ho amounting to US$50 million over a period of not more than five years, upon satisfying of certain conditions.
The deal is expected to be completed during the third quarter of 2016.
MGM Resorts stated in its press release it had been informed that Ms Ho had separately entered into an agreement to acquire 4 million shares of MGM Resorts stock at US$25.00 per share from Tracinda Corp.
Upon completion of the two deals, Ms Ho would own a stake of approximately 4.8 percent in MGM Resorts, stated the release.
Tracinda Corp was the investment vehicle of MGM Resorts’ founder Kirk Kerkorian. Following Mr Kerkorian’s death in June 2015, it was announced he had given orders in his will for his investment company to sell its stake in the Las Vegas-based casino and hotel operator. Prior to that order, Tracinda Corp held the largest single holding in MGM Resorts – a 16.19-percent stake.
MGM Resorts and Ms Ho began their Macau partnership in 2004, when the two parties formed a 50-50 joint venture. In 2005, the joint venture purchased a casino sub-concession from SJM Holdings Ltd – led by Ms Ho’s father Stanley Ho Hung Sun – for a total consideration of US$200 million.
The joint venture in 2011 floated on the Hong Kong Stock Exchange under the monicker of MGM China. As part of the operation, MGM Resorts became majority shareholder of the business, with a stake of 51 percent, leaving Ms Ho with cash and a much-diluted holding below 30 percent.
In a separate release issued on Tuesday, MGM China noted that Ms Ho would “remain a major shareholder” in the firm and would “continue to play a significant role” in MGM China’s business.
Apr 24, 2017The number of visitors to Macau in the first quarter of 2017 rose 5.6 percent year-on-year, to just over 7.87 million, according to data released on Monday by the city’s Statistics and Census...
Apr 24, 2017
Apr 24, 2017
Apr 24, 2017
Nov 23, 2016Hong Kong-listed casino equipment supplier Paradise...
Oct 27, 2016As Studio City – the US$3.2-billion, 2015 addition to...
May 26, 2016Macau’s pacapio Chinese lottery game will celebrate its...
May 18, 2016Russia-based Diamond Fortune Holdings Ltd says it has big...
Dec 31, 2015The year 2016 could see the coming of age of “destination...
"Many of the more sophisticated cheats are no longer detectable simply by video"
Vice president of global gaming at casino surveillance supplier Synectics