Barry Diller, People Withdraw $18bn BetMGM Takeover Bid

Billionaire Barry Diller’s People Inc. forewent its $18 billion planned takeover of MGM Resorts International. 

News of the dropped bid comes just after Caesars shareholders approved a $17.6 billion sale to Tilman Fertitta, owner of the Golden Nugget casino brand. Had Diller’s bid been accepted, he would’ve taken control of MGM Grand, the Bellagio, and numerous other properties on the Vegas strip and worldwide.

Diller noted that the removal of his bid was not a reflection of his optimism or lack thereof for MGM and its properties.

MGM will not sell to Diller, People

MGM Resorts confirmed on Wednesday that the bid had been withdrawn, leaving the hotel-casino enterprise as a “standalone company.” It did not provide any further details on why the bid was rescinded.

Diller said that a potential deal had not shaped up the way he had hoped, although he also did not provide specifics.

“There are lots of ingredients that go into a proposal of this kind on its way to completion,” he said. “We didn’t feel the mix was coming together in the way we had hoped and have decided not to pursue taking the company private at this time.”

Diller had offered $48.30 per share in cash in June — 43.7% more than the company’s stock price of $33.69 at the time of writing. MGM’s stock fell 8% in the hours after the announcement that the bid had been withdrawn.

Despite failing to agree to terms, Diller said that he and People would continue to be large financial supporters of MGM. 

“We continue to hold 66.8 million shares representing approximately 27% of MGM Resorts and have total confidence in both the management and the Company’s prospects,” he claimed.

Undervalued assets

People Inc. first invested in MGM Resorts in 2020. The attempt to control more than 50% of the company was based on Diller’s belief that resorts, casinos, and experiences were “AI proof” and would continue to have a consistent consumer base.

Diller even said that he believed that MGM’s assets were undervalued by the market.

MGM’s board of directors formed a special committee to negotiate with People Inc. That committee decided that it wanted to remain a standalone enterprise rather than join Diller’s larger business empire, which includes iconic brands such as PEOPLE, Food & Wine, Southern Living, Investopedia, Entertainment Weekly, and numerous others.

“The Board remains excited to continue to lead MGM Resorts as a standalone company,” stated Paul Salem, chairman of the MGM Resorts Board. “Our leading position in Las Vegas, our best-in-class regional properties, and BetMGM’s continued momentum highlight the value we bring to our shareholders. In addition, our international portfolio of MGM China and the significant opportunity ahead with MGM Osaka support a clear path to increasing shareholder value.”

MGM casinos are known for live-dealer table games, slot machines, and iconic hospitality properties — but the company is also pushing its sports betting brand, BetMGM, which it formed as a 50/50 venture with Entain Plc. A new advertising series with actor Jon Hamm highlights the betting experiences that await customers for games that are “never over.”