Dubai World, an investment arm of the Dubai government, announced in a filing with the U.S. Securities and Exchange Commission that it has increased its stake in MGM Mirage (MGM) to 6.5%. Cayman LP, an indirect wholly-owned subsidiary of Dubai World, said it consummated acquisition of 5 million MGM Mirage shares at $84.80 per share from "father of the megaresort" Kirk Kerkorian's Lincy Foundation on December 24, 2007.
According to the filing, Infinity World, Cayman Investments, Cayman LP, Cayman Holding, Infinity Holding and Dubai World, which are collectively called as 'Infinity World Group', own 19.55 million MGM Mirage shares. As reported in MGM Mirage's Quarterly Report on Form 10-Q for the quarter ended September 30, 2007, the company had 299.38 million outstanding shares of common stock.
On August 21, 2007, Dubai World entered into a joint venture with MGM's subsidiary Mirage Resorts Inc, to, among other things, develop, construct, operate and acquire a 50% ownership interest in the CityCenter project in Las Vegas. In accordance with the joint venture deal, Dubai World contributed about $2.96 billion towards 50% of the equity in CityCenter. Following the closing of the joint venture transaction, MGM Mirage received a cash distribution from the joint venture of about $2.47 billion. Also in connection with the creation of the Joint Venture, Infinity World entered into a Stock Purchase and Support Agreement.
On August 24, Dubai World's subsidiary Infinity World Development Corp. commenced a third party tender offer to purchase up to 14.20 million MGM Mirage shares at $84 per share. In response to the tender offer, only 348,838 MGM Mirage shares were tendered to the offer, and on October 18, 2007, Infinity World bought all the shares tendered. On October 18, Infinity World consummated the acquisition contemplated by the Stock Purchase Agreement and purchased 14.20 million MGM Mirage shares.
On December 18, Cayman LP entered into a Stock Purchase Agreement with Kirk Kerkorian's Lincy Foundation, obtaining the right to acquire beneficial ownership of 5 million MGM Mirage from the Foundation for a total purchase price of $424 million or $84.80 per share. Cayman specified that it consummated the acquisition contemplated by Lincy Stock Purchase Agreement on December 24.
In its filing with the SEC on August 22, Kirk Kerkorian's Tracinda Corp. noted that it holds 153.84 million shares or 54.1% of MGM Mirage. Even with these transactions of Dubai World, Tracinda will be the major shareholder of MGM Mirage.
MGM is currently trading at $85.80, gaining $1.55 or 1.84% on a volume of 290 thousand shares.
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