American media and technology firm Interactive Corporation (IAC) has reportedly spent approximately $1 billion in order to acquire a 12% stake in prominent land-based casino operator MGM Resorts International.
According to Monday reports from CNBC and CDC Gaming Reports, the New York-headquartered firm controlled by billionaire businessman Barry Diller (pictured) purchased 59 million MGM Resorts International shares at individual prices ranging from a high of $21.92 down to a low of $15.38 via 34 transactions between June 9 and August 7.
The investment comes at a time when the New York-listed casino firm’s land-based business is suffering from the impact of the ongoing coronavirus pandemic with its shares now worth around 35% less than at the start of the year. The Las Vegas-headquartered operator purportedly ended last month by announcing that its second-quarter net revenues had fallen by 91% year-on-year to just $291 million with its company-wide deficit for the three-month period standing at some $857 million.
Diller serves as Chairman for IAC and he reportedly used an official statement to detail that his firm has long been looking into the possibility of entering the $450 billion global online gaming industry. The 78-year-old purportedly moreover declared that the chance to buy a stake in MGM Resorts International, which operates the BetMGM iGaming service via the Roar Digital LLC joint venture it established with GVC Holdings, had represented a ‘once in a decade opportunity’ for his company to acquire ‘a meaningful piece of a preeminent brand in a large category with great potential to move online.’
Reportedly read a statement from Diller…
“What initially attracted us to MGM Resorts International besides its leadership in leisure, hospitality and gaming was an area that currently comprises a tiny portion of its revenues, online gaming. IAC’s foundational concept of seeking opportunities to build interactive businesses is our base rationale [and] there is a digital-first opportunity within MGM Resorts International’s already impressive offline businesses. With our experience, we hope we can strongly contribute to the growth of online gaming.”
CDC Gaming Reports explained that MGM Resorts International used its own statement to welcome this latest investor as ‘a long-term strategic partner’ that will soon have a seat on its board of directors. This release purportedly pronounced that Diller and the Chief Executive Officer for IAC, Joey Levin, are now destined to ‘bring vast experience in both entertainment and online commerce’ to its ranks and that it hopes to be able to ‘take full advantage’ of their know-how over the coming months and years.
Bill Hornbuckle, the newly-appointed Chief Executive Officer for MGM Resorts International, reportedly proclaimed that IAC has ‘expertise in growing and expanding brands online’ and is ‘a natural fit’ for his firm’s commitment to improving its online gaming and sportsbetting business and ‘enhancing the resort experience through curated and personalized offerings.’
Hornbuckle’s statement reportedly read…
“We appreciate that IAC shares our long-term strategic vision for growth and maximizing value for our shareholders. We welcome its collaboration and are excited at the possibilities it will bring.”