MGM Resorts International is a global hospitality and entertainment company operating destination resorts in Las Vegas, Mississippi, New Jersey and Detroit, including Bellagio, MGM Grand, Mandalay Bay and The Mirage. The company most recently opened MGM National Harbor in Maryland and is developing MGM Springfield in Massachusetts. It has a majority interest in MGM China Holdings Limited, which owns the MGM Macau resort and casino and is developing a gaming resort in Cotai. MGM Resorts owns 50 percent of CityCenter in Las Vegas, which features ARIA Resort & Casino. It has a majority controlling interest in MGM Growth Properties, a real estate investment trust.
The company began operations in 1987 as MGM Grand, Inc., and became MGM Mirage in 2000, after acquiring Mirage Resorts. In the mid-2000s, growth of its non-gaming (lodging, food, retail) revenue began to outpace gaming receipts and demand for high-rise condominiums was surging, with median property prices in Las Vegas twice the national average. The company shifted its focus from owning and operating resorts and casinos, to developing and building real estate in the leisure and gaming industry—launching the massive CityCenter mixed-use project, which was at the time of its construction the world's largest construction site and ranks as one of the most expensive real estate projects in history. City Center's development coincided with the global financial crisis, causing writedowns in its valuation.
In June 2010, the company changed to its present name, to reflect its latest strategy of expanding worldwide, including licensing its brand and expertise to develop non-gaming hotels and residences.
Billionaire investor Kirk Kerkorian and his Tracinda Corporation were, until 2009, the majority shareholders of MGM Mirage; Kerkorian was the former owner of the Metro-Goldwyn-Mayer movie studio, from which MGM Grand derived its name. Following a one-billion-dollar stock offering by MGM Mirage amidst the global credit crunch, Tracinda's shares were diluted from 53.8 percent to 39 percent. On June 15, 2010, shareholders voted for MGM Mirage to change its name to "MGM Resorts International", which emphasizes the brand's global scope and increased non-gaming strategy.
In 2013, MGM won state licenses to build a $1-billion resort in National Harbor, Maryland and a $950-million resort in downtown Springfield, Massachusetts. In May 2014, MGM broke ground on a $375-million arena on the Las Vegas Strip with sports and entertainment company AEG. MGM Resorts is the majority owner of MGM Growth Properties LLC (NYSE: MGP), a real estate investment trust that owns ten casino properties and leases them to MGM Resorts. It became a separate, publicly traded company in April 2016.
Among the company's management ranks, more than 38 percent are minorities and nearly 43 percent are women. The company continues to receive wide recognition for its diversity and inclusion initiatives, such as: 40 Best Companies for Diversity (Black Enterprise Magazine), Top 10 Companies for Latinos (DiversityInc Magazine), Best Places to Work for LGBT Equality (Human Rights Campaign Foundation), Top 10 Regional Companies(DiversityInc) Top 100 Companies for MBA Students (Universum Global) and Top Corporation for Women's Business Enterprises (Women's Business Enterprise National Council). FORTUNE magazine has named MGM Resorts one of the World’s Most Admired Companies.
The company's background can be traced to 1969, when airline and casino tycoon Kirk Kerkorian bought a controlling stake in the Metro-Goldwyn-Mayer film studio. In 1970 and 1971, Kerkorian struggled with debt from his acquisitions of MGM and Western Airlines, and was forced to sell a majority of his casino company, International Leisure, to Hilton Hotels at a steep discount. When the Las Vegas Hilton, the casino he had built, subsequently became the most successful hotel in Las Vegas, Kerkorian was inspired to lead the studio into the gambling industry. It opened the original MGM Grand Hotel and Casino (now Bally's Las Vegas) in 1973. The MGM Grand Reno followed in 1978.
By 1979, the two hotel-casinos accounted for most of MGM's income, and the company announced a plan to split itself in two. The next year, the film studio was spun off as a new company, while the original company, renamed as MGM Grand Hotels Inc., retained the two hotel-casinos. Kerkorian held a 47 percent stake in both companies.
In 1985, Kerkorian began seeking a buyer for MGM Grand Hotels, to allow him to concentrate on running United Artists and on developing new properties under the MGM Grand name. A deal was reached for Bally Manufacturing to buy the company; the deal closed in April 1986, and the two casinos were renamed under the Bally's brand. The terms of the sale allowed Kerkorian to retain rights to the MGM Grand name, and plans were announced to offer the stockholders of MGM Grand Hotels shares in a new company that would hold the naming rights.
The company now known as MGM Resorts International was formed in 1986 as Grand Name Co. as a subsidiary of Kerkorian's Tracinda Corporation. It was renamed the following year as MGM Grand, Inc.
The company's first venture was MGM Grand Air, a luxury airline offering service between New York and Los Angeles, which launched in September 1987. The company also made an offer to take over financially struggling Pan American World Airways, but it was rejected by Pan Am's board in November 1987 for being too conditional.
In August 1987, MGM Grand bid $152 million for the bankrupt Dunes Hotel in Las Vegas, but was beat out by Japanese billionaire Masao Nangaku. Instead, the company acquired the Desert Inn and Sands casinos in February 1988 from Summa Corporation for $167 million. The Sands was promptly sold to Sheldon Adelson's Interface Group for $110 million in April 1989.
In September 1989, the company announced plans for a $700-million Hollywood-themed complex, including a 4,000-room hotel and a theme park. The Desert Inn site was initially considered as a location for the project, but within weeks the location was finalized as the Marina Hotel and Casino and the Tropicana Country Club, which MGM Grand acquired for $93 million plus $30 million in stock. The company put the Desert Inn up for sale to focus efforts on the new project, but found no outside bidders, and agreed to sell it to Tracinda for $130 million. Construction on the MGM Grand Las Vegas and the MGM Grand Adventures theme park began in October 1991, and the property opened in December 1993 at a final cost of $1 billion. The park permanently closed in 2002 due to a lack of interest.
The company moved its headquarters from Beverly Hills to Las Vegas in July 1992.
During construction of the MGM Grand, the company acquired an option to buy an 18-acre site across the street from the project. Gary Primm of Primadonna Resorts approached MGM president Bob Maxey in 1994 with an idea for the site: a casino recreating the New York skyline. A joint venture was formed between the two companies, and construction began in March 1995. Completed at a cost of $460 million, the New York-New York Hotel and Casino opened in January 1997.
With New York-New York under development, MGM Grand made moves to expand in several other markets. An exploratory agreement to develop two casinos on the Chinese island of Hainan was announced in August 1994, but came to nothing. In Darwin, Australia, a lucrative market attracting high rollers from Pacific Rim countries, the company considered building a hotel, but instead bought the Diamond Beach Hotel and Casino, renaming it as the MGM Grand Darwin. MGM announced plans for an Atlantic City casino in July 1996. In Michigan, where voters approved casinos in November 1996, MGM made plans for a bid on one of the three available gaming licenses, which would eventually be approved and open in July 1999 as the MGM Grand Detroit.
In South Africa, with casino gambling newly authorized, MGM announced plans in August 1996 to develop 15 properties in conjunction with Tsogo Sun. The first, a temporary casino in Johannesburg's Sundome, opened in October 1998. Three more casinos followed before MGM agreed to sell out its interest in the properties to Tsogo Sun in November 2001.
Since the initiation of New York-New York, analysts had speculated that MGM Grand or Primadonna would buy out the other's interest in the project. Instead of making such a cash-intensive purchase, however, MGM agreed to buy Primadonna outright for $276 million in stock plus $336 million in assumed debt. The merger closed in March 1999, giving MGM ownership of three casinos and two golf courses at the Nevada–California state line, in addition to full control of New York-New York.
In February 2000, MGM Grand made an unsolicited offer of $17 a share to buy Mirage Resorts, which had foundered due to disappointing results at its new Beau Rivage and Bellagio resorts. Analysts expected a protracted battle, with Mirage founder Steve Wynn seen as unwilling to give up control but under pressure from institutional investors. Mirage rejected the offer, but Wynn met with Kerkorian the next day and named a price of $21 a share. The companies agreed on the higher price, for a total of $4.4 billion plus $2 billion in assumed debt. The merger closed in May 2000, giving MGM ownership of the Mirage, Treasure Island, Bellagio, Boardwalk, and Golden Nugget casinos in Las Vegas, the Golden Nugget in Laughlin, and the Beau Rivage in Mississippi, and a half share of the Monte Carlo. The company changed its name to MGM Mirage in August 2000. Mirage had also owned a half stake in the Borgata, a planned casino in Atlantic City, in a joint venture managed by Boyd Gaming. Work on the Borgata continued apace, and it would open in July 2003.
In 2001 and 2002, following the merger with Mirage, the company explored options for its next major development project, including opportunities in the Las Vegas, Atlantic City, Chicago, and Macau markets. The 55-acre site of the Boardwalk casino on the Las Vegas Strip was earmarked for a technologically advanced megaresort targeting a Generation X demographic. In Atlantic City, MGM shifted focus from its previously announced boardwalk site to a proposed billion-dollar hotel and casino on a 55-acre tract adjacent to the Borgata, where Wynn had planned to build the Le Jardin casino. In the Chicago market, MGM agreed to pay $600 million to buy the unfinished Emerald Casino in Rosemont, Illinois, whose investors had been accused of ties to organized crime. The deal was rejected, however, by state gaming regulators, and MGM then backed off its effort, saying that Illinois's casino tax was too high. In Macau, where Stanley Ho's 40-year government-granted monopoly on gambling was coming to an end, MGM submitted a bid for one of three available gaming concessions, but it was not selected, losing out to Ho, Las Vegas Sands, and Wynn Resorts.
MGM made moves into the United Kingdom market after a 2001 government report called for loosening of the country's gambling regulations. It opened an online casino, playmgmmirage.com, licensed in the Isle of Man, a British dependency, and it applied for a license to run an online sports betting site in the U.K. It acquired a twenty-five percent stake in a company developing the small Triangle Casino in Bristol, which went on to open its doors in February 2004. It inked deals to build casinos at the Olympia Exhibition Centre in London, St James' Park in Newcastle, Meadowhall Shopping Centre in Sheffield, the National Exhibition Centre in Birmingham, Sportcity in Manchester, Glasgow Harbour, King's Waterfront in Liverpool, and at a proposed stadium in Salford. The company also signed a $490-million deal to acquire Wembley plc, owner of seven greyhound tracks in Britain and four in the United States.
The British expansion plans ultimately amounted to nothing. MGM closed its online casino after less than two years, citing uncertainty in American regulations and competition from established British brands. The Wembley acquisition turned into a bidding war, with MGM finally losing out to an investors group including Kerzner International. The Triangle Casino was sold off to Stanley Leisure in 2006. The company's other development plans were scuttled as the government scaled down, and eventually abandoned, the plan to allow large "super-casinos".
On December 20, 2003, MGM and Turnberry Associates announced the formation of a partnership to build the luxury condo hotel, stating that they would build up to six towers each rising up to 40 stories. On May 12, 2006, the first tower opened for occupancy. The successful opening of The Signature at MGM Grand appears to be aided by its connection to the resources and amenities of The MGM Grand Hotel & Casino.
In 2004, the company disposed of some of its smaller properties, selling the two Golden Nugget casinos (Golden Nugget Las Vegas and Golden Nugget Laughlin) to Poster Financial Group for $215 million, and the MGM Grand Darwin to Skycity Entertainment for $140 million.
MGM entered into quiet merger talks with Mandalay Resort Group in early 2004. The potential acquisition, which would give MGM control of more than half the hotel rooms on the Las Vegas Strip, was seen as a "vote" for Las Vegas as the strongest gambling market in the world. Mandalay assets attractive to MGM included low-end casinos like Excalibur and Circus Circus to broaden MGM's "high roller" appeal; the Mandalay Bay Convention Center, which would allow MGM to compete directly with the Sands Expo center in the convention market; and at least two prime developable sites on the Strip. The talks went public in June, when MGM announced an offer worth $7.65 billion. Mandalay rejected that offer because of a clause allowing MGM to back out if antitrust regulators demanded the sale of any properties. Analysts speculated that another bidder such as Harrah's or Boyd might enter, but none did, and MGM and Mandalay soon agreed on a $7.9 billion deal.
MGM executives were confident that antitrust regulators would not require the sale of any of the two companies' properties. Michigan law, however, forbade one company from owning multiple casinos, requiring the sale of either the MGM Grand Detroit or Mandalay's 54 percent stake in the MotorCity Casino. After some vacillation about which property to sell, Mandalay accepted a $525-million offer for its interest in MotorCity from Marian Ilitch, the casino's second largest shareholder. Meanwhile, in Illinois, where MGM needed regulatory approval to take over Mandalay's 50 percent interest in the Grand Victoria Casino, a lack of quorum on the state Gaming Board threatened to delay the merger. MGM considered a sale to the casino's other owner, the Pritzker family, but ultimately gained approval for a plan to place the property under control of a trustee until completion of the licensing process. The FTC approved the merger as predicted, and MGM obtained a $7 billion line of credit to finance it. The sale closed on April 25, 2005 for a total of $7.9 billion, including $3 billion in assumed debt.
The Mandalay acquisition made MGM Mirage the largest gaming company in the world, but it was surpassed just two months later when Harrah's Entertainment acquired Caesars Entertainment in a deal that had been spurred on by news of the MGM-Mandalay merger.
Despite MGM's initial failure to win a gaming concession in Macau, the company had remained interested in the burgeoning gaming market. Rumors of a possible partnership with Stanley Ho were reported in 2003, but Nevada gaming regulators informally vetoed the idea because of the alleged involvement of organized crime triads in his casinos. Another possibility emerged when the government allowed the three gaming concessionaires to each sell a sub-concession. In June 2004, MGM formed a joint venture with Pansy Ho, Stanley's daughter, to develop a casino-hotel under a sub-concession from Stanley. Despite initial concerns about whether Pansy Ho was subject to her father's influence, the Nevada Gaming Commission eventually approved the partnership. Construction of the MGM Grand Macau began in June 2005. The property opened in December 2007, completed at a cost of $1.25 billion.
In 2004, MGM solidified its plans for the Boardwalk site on the Strip, announcing Project CityCenter, an $8-billion high-density project including hotels, condominiums, a casino, and a shopping mall. The Boardwalk was closed in January 2006 to make way for the redevelopment, and CityCenter construction began the following June.
Singapore emerged in 2004 as the next major new Asian gaming market, calling for proposals to build two "integrated resort" casinos at Marina Bay and the island of Sentosa. MGM partnered with CapitaLand in an estimated $3 billion bid for the Marina Bay site. Their bid advanced to the final stage against three competitors, and was seen as the favorite to win. The government awarded the license, however, to Las Vegas Sands, citing its strength in the meetings and conventions sector.
On April 25, 2006, MGM Mirage announced with Foxwoods Resort and Casino a joint partnership in developing an expansion plan at Foxwoods that will include a casino using the MGM Grand brand. On October 16, 2006, MGM Mirage announced that it planned to sell its properties in Laughlin (Colorado Belle Hotel & Casino and Edgewater Hotel and Casino) to a partnership of Anthony Marnell III and Sher Gaming. The sale price was $200 million. The sale closed on June 1, 2007. On October 31, 2006, MGM Mirage announced plans to sell Primm Valley Resorts to Herbst Gaming for $400 million. The proposed sale would not include the Primm Valley Golf Club. The sale closed on April 10, 2007.
The Nevada Landing Hotel and Casino closed a month earlier than planned on March 20, 2007.
On April 19, 2007 the company announced that it planned to purchase a 7.6-acre (31,000 m) site from Concord Wilshire Partners for $130 million and a 25.8-acre (104,000 m) site from Gordon Gaming for $444 million. The two parcels give the company complete control of the southwest corner of the Sahara and Las Vegas Boulevard intersection. When combined with underused parts of the Circus Circus site, the company will have a 68-acre (280,000 m) site for future development. The Concord site had been the proposed location for the Maxim Casino.
On August 22, 2007, Dubai World said it would buy a 9.5 percent stake in MGM for about $2.4 billion. It would also invest about $2.7 billion to acquire a 50 percent stake in MGM's CityCenter project. Dubai World would pay MGM Mirage an additional $100 million if the project opened on time and on budget. The investment firm would buy 14.2 million shares from MGM Mirage. The firm would also issue a public tender for an additional 14.2 million shares at the same price.
On October 29, 2008, MGM Mirage halted a $5 billion Atlantic City project on land next to the Borgata.
At about the same time, New Jersey gambling regulators were evaluating MGM Mirage's suitability to operate casinos in New Jersey, and were unconvinced that MGM Mirage's Macau partner, Pansy Ho, could operate independently from influence of her father, Stanley Ho. The latter was often accused of ties with Chinese organized crime and letting the gangs operate in his casinos' VIP rooms. Faced with not complying with New Jersey gaming regulations, MGM Mirage decided to divest the highly profitable Borgata in order to continue pursuing the even more lucrative Chinese market. MGM Mirage subsequently transferred its 50% share in the Borgata to a divestiture trust through which it received all benefit of the ownership. The trust was responsible for selling MGM's interest within 30 months, although MGM had the right to direct the trustee during the first 18 months.
On December 16, 2008, MGM Mirage announced the sale of its Las Vegas Treasure Island resort and casino to billionaire Phil Ruffin. The sale was completed on March 20, 2009 for $600 million in cash plus a $175 million promissory note.
On March 23, 2009 Dubai World and Infinity World announced that they had filed a lawsuit in the Delaware Chancery Court seeking to be released from their CityCenter joint venture agreement with MGM Mirage after the company filed its annual report stating that "there is substantial doubt about our ability to continue as a going concern," and "it cannot provide assurance that its business would generate sufficient cash flow from operation."
Starting on April 6, 2009 news reports surfaced that MGM Mirage had hired investment firm Morgan Stanley to assist the company in finding possible buyers for the MGM Grand Detroit and the Beau Rivage.
On June 15, 2010, shareholders approved a name change from MGM Mirage to "MGM Resorts International", to emphasize the brand's global scope and increased non-gaming strategy.
In April 2011 an initial public offering was announced for the MGM Macau property. Under the agreement, Pansy Ho would receive a 29 percent stake in the company, MGM China Holdings Ltd, which was created as a listing vehicle for the IPO. MGM Resorts would hold 51 percent and the public would receive 20 percent. MGM China raised $1.5 billion from its IPO on the Hong Kong Stock Exchange.
In January 2013, MGM China received government approval to build its second resort in Macau. The venture would pay a land premium of MOP$1.29 billion (US$162 million) and annual rent of MOP$2.15 million to develop a five-star hotel and a casino resort. The new project would be MGM's first resort in Macau’s Cotai area. The casino resort, with 1,600 hotel rooms, 500 gaming tables, and 2,500 slots, would take 36 months and US$2.5 billion to build.
In December 2013, a state commission awarded a casino license to MGM Resorts to build a $1-billion resort at National Harbor in Prince George's County, Maryland. Throughout 2013, MGM Resorts conducted a significant refinancing of company debt, and by March 2014 the debt load was reduced to $13.4 billion.
In late 2013, Foxwoods and MGM ended their relationship, and the MGM Grand at Foxwoods was renamed the Fox Tower.
In mid-2013, the Company also embarked on a remodeling and rebranding of THEhotel at Mandalay Bay into Delano Las Vegas. Delano opened in September 2014.
On May 1, 2014, the company broke ground on the $375-million T-Mobile Arena located behind New-New York Hotel and Casino, in partnership with AEG Live. T-Mobile Arena celebrated its grand opening on April 6, 2016, with a concert featuring local favorites The Killers, Wayne Newton and Shamir. Two days earlier on April 4, MGM unveiled The Park, an outdoor dining and entertainment district that serves a gateway to the arena.
In September 2014, MGM Resorts International agreed to sell the Railroad Pass Casino to Joseph DeSimone, a Henderson-based real estate broker and developer. The sale was completed in April 2015, with Marcus Suan assuming operation of the casino while Joseph DeSimone pursued a gaming license. On October 16, 2014, MGM agreed to sell the Gold Strike for $12 million to Jett Gaming, owned by the Herbst family. On April 23, 2015, the Nevada Gaming Commission approved the sale of Gold Strike from MGM to Jett Gaming. On May 4, 2015, the sale of Gold Strike from MGM to Jett Gaming was completed.
In November 2014, the Massachusetts Gaming Commission approved a license for MGM Springfield, an $800-million project.
The Las Vegas Festival Grounds was developed by MGM Resorts International, Cirque du Soleil, and Ron Burkle's Yucaipa Companies, primarily to serve as the site of the biannual music festival Rock in Rio USA, which held its inaugural edition in 2015.
In July 2015, MGM agreed to sell its properties in Reno (Circus Circus Reno and a 50 percent stake in the Silver Legacy) to Eldorado Resorts for $72.5 million.
In April 2016, MGM held an initial public offering for MGM Growth Properties LLC, a new real estate investment trust (REIT) with ownership of ten of the company's casinos; the parent company would continue to operate the casinos under a lease agreement. The offering raised $1.05 billion, and left MGM Resorts with 76 percent ownership of the REIT. In May 2016. MGM Resorts International and MGM Growth Properties LLC acquired the Borgata Hotel Casino & Spa in exchange for $900 million.
In June 2016, MGM announced a joint venture with Sydell Group that the Monte Carlo would be renovated and rebranded as the Park MGM, named after the adjacent dining and entertainment district, The Park, that opened in April 2016, and the NoMad Hotel would occupy the top floors. It will feature the new Eataly restaurant. Both hotels will begin construction at the end of 2016 and will open in 2018.
In August 2017, MGM launched its first real-money online casino in New Jersey. Under the brand name playMGM, the online gambling site went live with over 200 slot games and over 20 table games, including 11 new games not found at other online casinos.
In 2007, MGM Hospitality was established to operate hotels, resorts and residences in key destinations around the globe using the brands of Bellagio, MGM Grand and SKYLOFTS.
In 2009, the Company formed Diaoyutai MGM Hospitality, a joint venture between Diaoyutai State Guesthouse of China, the Chinese Foreign Ministry’s venue for VIPs, and MGM Resorts International. This joint venture is developing and operating 5-star hotels and resorts in China.
On April 15, 2014, MGM Resorts International and Hakkasan Group announced the formation of a joint venture hotel management company, to be named MGM HAKKASAN Hospitality. The strategic alliance focuses on the design, development and management of luxury and upper upscale non-gaming hotels, resorts and residential offerings under the Bellagio, Hakkasan, MGM Grand and SKYLOFTS brands in key international gateway cities and prime resort destinations across the globe. All of the hotel and resort projects currently under development by each group will be contributed to the joint venture, including MGM projects in the Americas, Middle East, and Asia, and Hakkasan projects in Abu Dhabi and Dubai. Projects in China will continue to be developed and operated by Diaoyutai MGM Hospitality.
All properties are wholly owned by MGM Resorts International except where indicated.
The MGM Resorts International Aviation fleet comprises of five aircraft (as of August 2017): a Gulfstream V, two Embraer Legacy 500, and two Embraer Lineage 1000.
The Company’s top executives include; James Murren, Chairman and Chief Executive Officer; Bill Hornbuckle, President and Chief Marketing Officer; Corey I. Sanders, Chief Operating Officer and John McManus, Executive Vice President and General Counsel.
Among the company's management ranks, more than 38 percent are minorities and nearly 43 percent are women.
The company continues to receive wide recognition for its diversity and inclusion initiatives, such as: 40 Best Companies for Diversity (Black Enterprise Magazine) in 2012, Best Places to Work for LGBT Equality (Human Rights Campaign Foundation) in 2013, Top 10 Regional Companies (DiversityInc) in 2014, Top 10 Companies for Latinos (DiversityInc Magazine), and top 100 Companies for MBA Students (Universum Global) in 2014. Fortune has named MGM Resorts one of the World’s Most Admired Companies.