MGM Mirage Completes $7.9 Billion Purchase of Mandalay

Staff -- Tradeshow Week, 5/9/2005

MGM Mirage has completed its buyout of Mandalay Resort Group for $7.9 billion. At the same time, the company changed its New York Stock Exchange trading symbol to "MGM."

The deal, expected to close months earlier, was stalled by gaming board and casino ownership regulations in Michigan and Illinois, where the companies had properties affected by the transaction. The snag was solved by selling Mandalay's MotorCity Casino in Detroit, and putting its 50-percent ownership of the Grand Victoria riverboat casino in Elgin, Ill., into escrow.

With the completion of the acquisition, MGM owns and operates 24 hotel and casino sites in Michigan, Mississippi and Nevada. In Las Vegas, the company's 11 Strip properties offer 36,841 hotel rooms. The company controls more than 1.3 million square feet of exhibit space and 717,883 sq. ft. of meeting space between Mandalay Bay Resort & Casino, MGM Grand Hotel & Conference Center and Mirage Casino-Hotel.

As part of the merger, former MGM Grand Vice President of Sales Richard Harper became vice president of sales and marketing for Mandalay Bay. He replaced Danielle Babilino, who resigned shortly before the announcement of the deal.

Harper told Tradeshow Week that he does not expect the large blocks of rooms and convention space coming under single-company control to have a direct impact on room rates. Rather, he sees potential for increased synergy between the sister properties, that "hopefully will benefit the customer and give them access maybe that they didn't have before."

In a statement, MGM Mirage Chairman and CEO Terry Lanni said the combination of the properties' people and assets "creates the best opportunity to serve an ever more diversified customer base."

The combined company employs some 70,000 people and claims pro forma annual revenues of $7 billion.