MGM Takes Sale Off the Table

Updated from 10:10 a.m. EDT

In a surprise move, billionaire investor Kirk Kerkorian dropped his efforts to buy two of MGM Mirage's (MGM Quote) prime Las Vegas properties, instead backing the casino operator's plan for a new joint venture that will monetize other real estate assets at the company.

MGM shares were down $5.63, or 6.5%, to $80.87 Wednesday, since the new plan means the company likely won't be sold anytime soon. The stock has surged more than 30% over the past month since Kerkorian, who owns more than half of MGM's shares, announced that he wanted to buy MGM's Bellagio casino and its City Center development.

Analysts had speculated that Kerkorian's interest would set the wheels in motion for a sale of the entire company or other prime assets. MGM had formed a special committee to review potential transactions, but said Wednesday that the committee had been dissolved.

While a sale of the company might no longer be in the cards, MGM announced a new joint venture to unlock real estate value for land it owns on the northern part of the Las Vegas strip, near where Boyd Gaming(BYD Quote) just broke ground on its Echelon Place development .

MGM said it would partner with Kerzner International to jointly develop a multi-billion-dollar resort on 40 of the 78 acres MGM owns on the corner of Las Vegas Boulevard and Sahara Avenue.

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