Kerkorian Bets on Bellagio

Billionaire who controls MGM Mirage makes bid for its two hottest assetsi
By J. Kelman,  Newser User
Posted May 22, 2007 2:54 PM CDT
Kerkorian Bets on Bellagio
Dancing fountains in front of the Bellagio are one of the favorite, and free, attractions in Las Vegas, Nevada.   (KRT Photos)

(Newser) – Activist investor Kirk Kerkorian, who holds a controlling interest in MGM Mirage, is making a play to buy two of the casino company's crown jewels. Kerkorian's company, Tracinda Corp., is in talks to acquire MGM's Bellagio Casino and the $7.4 billion CityCenter development, currently under construction. Kerkorian currently owns 56% of MGM Mirage.

The offer may presage a larger strategy to take the company private. Or it may just be a brilliant—if slightly untoward—profit generator, says Keith Hahn at Dealbreaker.com. "He’s making a bid for his own assets, and causing the stock of the public company to skyrocket in price," Hahn writes. Kerkorian’s MGM shares are up $2.5 billion since yesterday. "It stinks of an inside deal," one analyst tells the Wall Street Journal. (Read more Bellagio stories.)

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