Dubai World to acquire stake in casino operator MGM Mirage

22 August 2007

Mumbai: Dubai World, the investment arm of the Dubai government, will acquire a 9.5 per cent stake in MGM Mirage and 50 per cent of the casino operator's CityCenter development project for $5 billion, a source close to the developments said.

Under the deal, Dubai World will pay $2.7 billion to acquire a 50 per cent stake in CityCenter - a $7.4 billion project comprising hotels, condos and retail outlets and spread over 76 acres in Las Vegas, due to open in 2009.

Dubai World will also buy 14 million shares from MGM Mirage at $84 each, or about $1.2 billion, which is a 13 per cent premium over its August 21 closing price of $74.32 on the New York Stock Exchange.

The investment firm said it also intends to buy an additional 14 million shares from the public at about the same price.

The stake purchase by Dubai World, which was first reported by the Wall Street Journal, will likely quell takeover talk surrounding the second-largest casino company.