Exhibit 99.1
MGM Resorts International Announces the Termination of its Modified Dutch Auction Tender Offer
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result of this termination, no Shares will be purchased in the Tender Offer and all Shares previously tendered and not withdrawn will be promptly returned to tendering holders.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.
