Shares of MGM Resorts (MGM) - Get MGM Resorts International (MGM) Report soared Monday after Barry Diller’s IAC/InterActiveCorp. (IAC) - Get IAC/InterActiveCorp. Report announced it has built up a 12% equity stake in the casino company.
MGM stock recently traded at $22.20, up 16.66%. The stock has slumped 33% year to date as the coronavirus shut casinos for weeks and consumers have been reluctant to travel.
IAC shares traded at $133.59, up 0.41% and have jumped 26% so far this year.
“What initially attracted us to MGM, besides its leadership in leisure, hospitality and gaming, was an area that currently comprises a tiny portion of its revenue - online gaming,” IAC Chairman Diller said in a statement.
"IAC's foundational concept of seeking opportunities to build interactive businesses is our base rationale. There is a digital first opportunity within MGM Resorts' already impressive offline businesses, and with our experience we hope we can strongly contribute to the growth of online gaming," he added.
MGM Resorts also said it was excited about IAC's move.
"IAC's family of brands and digital expertise are a great complement to the direction MGM Resorts has been taking both in leveraging our digital assets to enhance our guests' experience and building a leading iGaming and sports betting business in BetMGM,” MGM Chairman Paul Salem said in a statement.
Earlier Monday, MGM benefited from the news that China will resume granting tourist visas for visitors to the gambling mecca. Zhuhai city in Guangdong province plans to provide visas for mainland China residents to begin traveling to the island on Aug. 12.