Deal proposal: People (formerly IAC) submitted a non‑binding cash offer of $48.30 per share to acquire all MGM Resorts International shares it does not already own, representing a 24.1% premium to the 30‑day VWAP (through 29 May), >30% premium to the 90‑day VWAP, and 10.6% premium to the most recent closing price. People already holds 26.1% of MGM’s outstanding common stock.
Financing: The transaction is expected to be funded through a mix of People’s existing cash, MGM’s cash, and additional debt and equity commitments, with no financing condition. Post‑closing, People aims to own just over 50.1% of the equity, leaving minority investors with the remainder, and MGM’s current management will continue to run the business.
Market reaction: Entain plc shares rose more than 3% (up 3.52%) on the news. IAC shares gained 1.09% and MGM shares jumped 16.08% following the announcement.
Potential downstream effect: Morgan Stanley noted that a change in MGM ownership could trigger a follow‑on transaction involving BetMGM, the U.S. sports‑betting joint venture between Entain and MGM. The brokerage said a separation of the Entain platform is technically feasible and forecast BetMGM’s 2027 EBITDA at $451 million, valuing the JV at 250 pence per share.
Strategic rationale: People chairman Barry Diller stated that MGM’s assets are “not currently realizing their full potential in the public markets” and that the market materially undervalues the power and durability of MGM’s assets, justifying a take‑private approach.
