MGM Resorts International says discussions over a potential transaction with People Incorporated have ended. People withdrew its proposal to acquire MGM, and the casino group said no transaction is now contemplated, according to the company's amended voting agreement announcement.
President and CEO Bill Hornbuckle told investors that MGM would return its focus to operating the business. His comments on the 28 October earnings call followed months of talks between People and a special committee of independent MGM directors. The CDC Gaming account of the call reports that the parties had agreed a price, but People could not assemble the financing group it sought and withdrew the offer.
The revised agreement sets a 29.9% ceiling on the combined MGM ownership of People, Barry Diller and specified associated parties. It also requires the covered entities, subject to the agreement's conditions, to vote their shares in line with the MGM board's recommendation on a change-of-control transaction. MGM agreed not to take defensive measures aimed at those entities while they comply with the agreement.
Chairman Paul Salem said the framework leaves the board able to pursue share repurchases or a change of control if appropriate. The company stressed that neither side is obliged to enter another transaction.
The update arrived alongside MGM's third-quarter results. Revenue declined 1% year on year to $4.2 billion, while the net loss attributable to MGM narrowed to $17 million from $285 million. Consolidated adjusted EBITDA fell to $403 million from $506 million. Management pointed to MGM China, digital operations and the Osaka integrated resort as long-term growth areas.
