LAS VEGAS, March 12, 2020 /PRNewswire/ -- MGM Resorts
International (the "Company" or "MGM") (NYSE:
MGM) announced today that it has terminated its offer to
purchase up to $1,250,000,000 in
aggregate purchase price of its issued and outstanding shares of
common stock, par value $0.01 per
share (each, a "Share" and, collectively, the
"Shares"), which was due to expire at 12:00 midnight, at the
end of the day, New York City
time, on March 12, 2020 (such offer,
the "Tender Offer"), as a result of the Share price and
market index conditions to the Tender Offer not having been
satisfied. As a result of this termination, no Shares will be
purchased in the Tender Offer and all Shares previously tendered
and not withdrawn will be promptly returned to tendering
holders.
"As a result of the unforeseen and unprecedented volatility in
the financial markets due to coronavirus, and the resulting impact
on our ability to determine and maintain an offering price range,
we have decided to terminate the tender offer," said Jim Murren, Chairman and CEO of MGM Resorts.
"The health and safety of our guests and employees is our highest
priority, and we continue to take all steps necessary to combat the
impact of the coronavirus. As leaders in the communities where we
operate, we are constantly coordinating with health and public
officials to ensure that MGM provides the latest information and
guidance to our employees and guests."
"To date, efforts to contain the virus have resulted in
cancellations or postponements of major conferences, festivals, and
sporting events as well as a reduction in broader travel demand in
Las Vegas and across the globe. As
a result, our domestic resorts have been impacted in the near term
primarily driven by increased cancellations in our hotel and
convention bookings in Las Vegas
particularly during the months of March and April. In light of
these trends, we are actively managing our costs to help protect
our margins. Further, MGM China continues to be impacted by low
visitation following the 15-day closure of our Macau properties."
"Our recently closed real estate transactions, as well as the
contemplated $1.4 billion redemption
of operating partnership units, will provide us with approximately
$8.2 billion of net cash proceeds,
allowing us to achieve our strongest balance sheet in the last
decade and one of the strongest in our industry. The execution of
our asset light strategy has uniquely positioned us with the
flexibility to continue to make purchases under our recently
announced $3 billion share repurchase
program, while maintaining our strong liquidity position in this
environment."
Concluded Mr. Murren, "At this time, we believe the Company has
ample liquidity to weather the current uncertainties in the
marketplace. More importantly, we do not expect the coronavirus to
have a material impact on our business long term."
As of March 11, 2020, the Company
had cash investments of approximately $2.4
billion, excluding MGM China Holdings Limited and MGM Growth
Properties LLC, and after giving effect to the approximately
$857 million paid in connection with
the debt tenders. In addition, the Company has a $1.5 billion undrawn revolving credit facility,
providing approximately $3.9 billion
of liquidity.
On February 13, 2020, MGM
commenced the Tender Offer, pursuant to which, as amended on
February 28, 2020, holders of Shares were invited to tender
some or all of their Shares at a price within the range of
$23.50 to $28.00 per Share, which would have enabled MGM to
purchase for cash up to 53,191,489 Shares.
MGM's obligation to acquire Shares pursuant to the Tender Offer
was subject to various terms and conditions as specified in the
offer to purchase and letter of transmittal documents that were
distributed to holders, including a condition that, as amended on
February 28, 2020, specified that there shall not have
occurred any decrease of more than 15% in the sale price of the
Shares on the New York Stock Exchange ("NYSE") or a decrease
of more than 10% in the general level of market prices for equity
securities in the United States of
the New York Stock Exchange Index, the Dow Jones Industrial
Average, the NASDAQ Global Market Composite Index or Standard &
Poor's Composite Index of 500 Industrial Companies, in each case,
as measured from the close of trading on February 28, 2020,
the date of the announcement of the amendment of the price range
for the Tender Offer.
Under the terms of the Tender Offer, once such a decrease
occurred at any time prior to the expiration of the Tender Offer,
and regardless of any subsequent Share price or market index
changes, MGM had the right to terminate the Tender Offer.
On March 5, 2020, the sale price of the Shares on the NYSE
reached a low of $20.44, a decrease
of approximately 16.8% from the sale price of the Shares on the
NYSE as of the close of trading on February 28, 2020, thereby
triggering the failure of the Share price condition referred to
above, and the sale price of the Shares on the NYSE has remained at
a level representing a greater than 15% decrease compared to
February 28, 2020 for all or significant portions of each
trading session from March 5, 2020 to
March 12, 2020. In addition, on
March 11, 2020, the New York Stock Exchange Index declined to
levels representing a decrease of approximately 10.7% from the
close of trading on February 28, 2020, thereby triggering the
failure of the market index condition to the Tender Offer as well.
Accordingly, the Company has exercised its right to terminate the
Tender Offer as a result of these triggering events having
occurred.
The Company may seek opportunities in the future to repurchase
Shares from time to time, subject to applicable law, pursuant to
its previously authorized share repurchase program. Such future
repurchases, if any, may be effectuated through open market
purchases under a plan that complies with
Rules 10b-18 and 10b5-1 under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), through private
purchases or through other similar transactions, and would be
subject to market conditions, applicable legal requirements,
contractual obligations and other factors. Rule 13e-4(f) under the
Exchange Act generally prohibits the Company and its affiliates
from purchasing any Shares until at least ten business days after
the date the Tender Offer was terminated, subject to certain
limited exceptions.
About MGM Resorts International
MGM Resorts International (NYSE: MGM) is an S&P 500® global
entertainment company with national and international locations
featuring best-in-class hotels and casinos, state-of-the-art
meetings and conference spaces, incredible live and theatrical
entertainment experiences, and an extensive array of restaurant,
nightlife and retail offerings. MGM Resorts creates immersive,
iconic experiences through its suite of Las Vegas-inspired brands. The MGM Resorts
portfolio encompasses 29 unique hotel and destination gaming
offerings including some of the most recognizable resort brands in
the industry. Expanding throughout the U.S. and around the world,
the company recently acquired the operations of Empire City Casino
in New York and Hard Rock Rocks
Casino in Ohio, which was
rebranded as MGM Northfield Park. In 2018, MGM Resorts opened MGM
Springfield in Massachusetts, MGM
COTAI in Macau, and the first
Bellagio-branded hotel in Shanghai. The over 80,000 global employees of
MGM Resorts are proud of their company for being recognized as one
of FORTUNE® Magazine's World's Most Admired Companies®. For more
information visit us at www.mgmresorts.com.
Forward-Looking Statements
Statements in this release that are not historical facts are
"forward-looking" statements and "safe harbor statements" that
involve risks and/or uncertainties, including those described in
the Company's public filings with the SEC. The Company has based
forward-looking statements on management's current expectations and
assumptions and not on historical facts. Examples of these
statements include, but are not limited to, statements the Company
makes regarding any repurchases of Shares the Company may make in
the future, including under its share repurchase program. These
forward-looking statements involve a number of risks and
uncertainties. Among the important factors that could cause actual
results to differ materially from those indicated in such
forward-looking statements include effects of economic conditions
and market conditions in the markets in which the Company operates
and competition with other destination travel locations
throughout the United States and the world, the design,
timing and costs of expansion projects, risks relating to
international operations, permits, licenses, financings, approvals
and other contingencies in connection with growth in new or
existing jurisdictions and additional risks and uncertainties
described in the Company's Form 10-K, Form 10-Q and Form 8-K
reports (including all amendments to those reports). In providing
forward-looking statements, the Company is not undertaking any duty
or obligation to update these statements publicly as a result of
new information, future events or otherwise, except as required by
law. If the Company updates one or more forward-looking statements,
no inference should be drawn that it will make additional updates
with respect to those other forward-looking statements.
MGM RESORTS
CONTACTS:
|
|
|
Investment
Community
|
News Media
|
AARON
FISCHER
|
BRIAN
AHERN
|
Chief Strategy
Officer
|
Director of Media
Relations
|
(702) 693-7152
or afischer@mgmresorts.com
|
media@mgmresorts.com
|
View original
content:http://www.prnewswire.com/news-releases/mgm-resorts-international-announces-the-termination-of-its-modified-dutch-auction-tender-offer-301022654.html
SOURCE MGM Resorts International