MGM Resorts welcomes significant investment by IAC11th August 2020 8:09 am GMT
Shares in New York-listed MGM Resorts International gained over 13 per cent Monday following a “significant investment” by media and entertainment company InterActive Corp. (IAC).
IAC has acquired a 12 per cent stake in MGM Resorts for approximately $1 billion, citing the potential of its online gaming business.
“With the separation of Match Group from IAC, and 'new' IAC emerging with $3.9 billion of cash, no debt, and its opportunistic zeal intact, we are energized and excited to make this investment in MGM,” said IAC chairman and senior executive Barry Diller.
“What initially attracted us to MGM, besides its leadership in leisure, hospitality and gaming, was an area that currently comprises a tiny portion of its revenue – online gaming.
“IAC's foundational concept of seeking opportunities to build interactive businesses is our base rationale – there is a digital first opportunity within MGM Resorts' already impressive offline businesses, and with our experience we hope we can strongly contribute to the growth of online gaming.”
MGM Resorts chairman Paul Salem commented: “We could not be more excited to welcome IAC and Mr. Diller as an investor in MGM Resorts. Mr. Diller and Joey Levin, CEO of IAC, bring vast experience in both entertainment and online commerce and we will take full advantage of their experience.
“IAC's family of brands and digital expertise are a great complement to the direction MGM Resorts has been taking both in leveraging our digital assets to enhance our guests' experience and building a leading iGaming and sports betting business in BetMGM,” Salem added. “We welcome IAC as a long-term strategic partner and intend to invite them to join our Board of Directors.”
MGM Resorts chief executive Bill Hornbuckle added that IAC’s expertise in growing online brands is a natural fit with the company’s focus on enhancing the digital sports betting and gaming experience.
“We appreciate that they share our long-term strategic vision for growth and maximizing value for our shareholders. We welcome their collaboration and are excited at the possibilities it will bring,” said Hornbuckle.
Shares in MGM Resorts International (NYS:MGM) closed up 13.77 per cent at $21.65 per share in New York Monday, while shares in InterActive Corp. (NSQ:IAC) closed 1.34 per cent lower at $131.27 per share.