One of the key measures that MGM Mirage plans to use in its return to financial health will be kicked off in the third quarter of 2010, according to Chairman and CEO James Murren. The IPO that was announced several months ago is moving along as planned, says Murren, and should be ready to go by August or September.
“I’m confident we’ll get the IPO done in the third quarter, probably in the August/September time frame,” Murren told a reporter with Bloomberg Television.
In addition to the paperwork necessary to launch such an IPO, MGM Mirage had to settle the outstanding issue in New Jersey, where the state Division of Gaming Enforcement had rejected Ho as a partner for MGM Mirage and recommended that the Casino Control Commission require the company to either end that relationship or withdraw from the state, where it owns 50 percent of the Borgata. The decision was clear.
A proposal it sent to the commission last month was accepted, turning the company’s equity into a trust until its interest is sold.
“We have the utmost respect for the DGE but disagree with its assessment of our partner in Macau,” said Murren.
The DGE report charged that Pansy Ho is unsuitable because Stanley Ho has been and allegedly still is involved with the organized crime Chinese triads, and Pansy is still inexorably linked with him. Even though Stanley Ho has never been indicted or convicted of a crime, the report cited numerous government documents claiming the connection and even quoted former MGM Mirage Chairman Terry Lanni saying “perception is reality” with regard to Ho’s involvement with organized crime. Both Pansy and Stanley Ho vehemently deny the charge.
Murren also revealed that the company will seek to sell bonds between now and June in a favorable climate.
“We can work on our time frame,” Murren said. “Rates are fairly attractive right now and that will push out another big part of our debt into 10-year paper, plus will give us more flexibility in the near term.”
The IPO will sell shares in the Macau partnership of MGM Mirage and Pansy Ho. It follows two IPOs last year by Las Vegas Sands and Wynn Resorts that raised more than $1 billion for each company.