Stay informed with the
NEW Casino City Times newsletter!
ILLINOIS -- Illinois gaming regulators Thursday gave MGM Mirage the last necessary approval for the company to close its $7.9 billion purchase of the Mandalay Resort Group on Monday.
The Illinois Gaming Board voted 4-0 (one member was absent) to move Mandalay's 50 percent ownership in the Grand Victoria riverboat casino into an escrow account that will be managed by a trustee.
MGM Mirage said in a statement that the company expects to complete the merger once Mandalay establishes the escrow account and closes on the sale of its MotorCity Casino in Detroit. All are expected to take place by Monday.
John Redmond, president and chief executive officer of MGM Grand Resorts, said after the ruling by Illinois gaming members that he was "ecstatic" about the approval.
"We've been doing this since June, and we just can't wait to move forward," Redmond said.
MGM Mirage will gain Mandalay's ownership in the Grand Victoria once the Illinois Gaming Board completes its review of the company and issues a finding of suitability.
MGM Mirage spokesman Alan Feldman said he didn't know a timetable for the licensing, but said the company had filed the necessary paperwork with Illinois authorities.
Nevertheless, Thursday's action was enough to allow the merger to be completed.
MGM Mirage, the world's second-largest gambling company, agreed in June to buy rival Mandalay for $7.9 billion, which included the purchase of $4.8 billion of Mandalay stock at $71 a share and assumption of almost $3 billion in company debt.
The transaction will give the company control of 11 casinos on the Strip, including the Bellagio, MGM Grand, Mandalay Bay and Circus Circus.
MGM Mirage had hoped to close the transaction at the end of March, following approvals from shareholders of both companies, Nevada and Mississippi gaming regulators and the Federal Trade Commission.
However, the Illinois Gaming Board was prevented for months from voting on the sale after resignations in August left the board one member short of a quorum. Gov. Rod Blagojevich waited seven months before appointing new board members a few weeks ago.
The companies pushed back the closing date of their merger while they awaited the Illinois regulators' approval. Mandalay owns and operates 11 properties in Nevada, as well as the Gold Strike in Tunica, Miss. The company's 53 percent ownership in the MotorCity had to be sold because MGM Mirage already operated the MGM Grand Detroit.
The deal will give MGM Mirage control of 28 properties in Nevada, Illinois, New Jersey, Michigan and Mississippi and the company will employ 75,000 employees, 95 percent based in Nevada.
When the deal closes, MGM Mirage will be the industry's largest casino operator until Harrah's completes its $9.4 billion buyout of Caesars Entertainment, expected to be completed by the end of June.
Shares of Mandaly rose 2 cents to close at $70.91 Thursday on the New York Stock Exchange. MGM Mirage shares rose $1.59, or 2.4 percent, to close at $68.69 on the NYSE.
Copyright GamingWire. All rights reserved.