MGM Resorts International (NYSE: MGM) could see its holdings in Asia up for sale if Barry Diller’s People Inc. (NASDAQ: IAC) successfully acquires the casino giant. That’s the view from Seaport Research Partners analyst Vitaly Umansky, who sees potential divestments of MGM China and the under-construction MGM Osaka in Japan as part of the acquisition strategy. This perspective was shared in a recent report by Umansky, aligning with other analysts who believe Diller’s $48.30 per share bid undervalues key assets of MGM.
Valuing MGM’s Asian Holdings
MGM holds a 56% stake in MGM China, which operates MGM Cotai and MGM Macau. Umansky estimates this stake is worth around $3.04 billion. The upcoming MGM Osaka, with its scheduled 2030 opening, adds another major piece to the puzzle. At a $8.9 billion valuation for the resort, MGM’s 40% interest in it translates to approximately $3.56 billion. Combined, these holdings command a value greater than one-third of Diller’s current $18 billion offer for MGM. However, selling MGM Osaka could pose challenges. It’s untested in the market, and potential buyers would essentially be buying into forecasts rather than proven financials. “Prospective buyers would be evaluating expectations more than results,” Umansky noted. Meanwhile, interest in MGM China might be more strong given the difficulty new entrants face accessing the Macau market.
Strategic Implications
The potential sale of these Asian assets would reshape MGM’s focus, possibly concentrating more on its U.S. operations. Diller has been vocal about his dissatisfaction with MGM’s current stock performance, suggesting a desire to unlock value and showcase appealing market positions. And umansky pointed out the media mogul’s serious intentions toward acquiring MGM, which could trigger a reevaluation of MGM’s asset portfolio. Analysts also speculate on the future of BetMGM, a joint venture with Entain Plc (OTC: GMVHY). There’s chatter that Diller might seek full control over the digital gaming sector, using his company’s expertise in turning online businesses profitable. When MGM tried to buy Entain in 2021, Diller showed interest in supporting the acquisition financially.
Regulatory and Market Context
If a sale is pursued, the regulatory market will play a pivotal role. Macau has been known for its stringent regulatory environment, often challenging operators. Japan, too, is treading carefully as it ventures into integrated resorts—a market still in its infancy. And industry watchers know this isn’t MGM’s first encounter with regulatory scrutiny in Asia. And with every potential transaction comes uncertainty. Whether regulatory bodies will have a say in this potential reorganization is yet to be disclosed.
Outlook
The industry will be closely observing if People Inc. proceeds with its takeover play. But the potential divestment of MGM’s international stakes could alter its strategic focus, impacting global operations. Meanwhile, the board’s decision on Diller’s offer remains pending, with larger implications for MGM’s corporate narrative in the weeks to come.
Eri Gaitu leads the news desk at Best in Slot, tracking breaking developments across the gambling world in real time. From exclusive bonus offers and casino launches to licensing updates and regulatory shifts, Eri ensures readers are always first to know about the changes that matter to their gaming experience.
