Tracinda Corp. plans to launch a tender offer for up to 15 million shares of
, a move that could give investor Kirk Kerkorian an additional 5.3% of the casino operator's outstanding shares.
Tracinda, Kerkorian's investment vehicle, said it will pay $55 a share for MGM, representing a 12% premium over the company's closing stock price of $49 on Tuesday.
Tracinda currently owns 158.4 million MGM shares, equal to 56.3% of the outstanding stock. The additional shares to be purchased represent 5.3% of the company's outstanding stock, or 12.2% of the shares not already owned by Kerkorian. Following the tender, he would hold a 61.7% stake.
"This tender offer demonstrates our confidence in MGM MIRAGE and its management and our commitment to the company's future," said a Tracinda representative in a press release.
Shares of MGM were surging 11% to $54.20 in premarket trading.
Other casino stocks also were higher.
Las Vegas Sands
traded up $2.02, or 2.3%, to $93.77;
climbed $1.50, or $3.6%, to $43.61; and
rose $3.05, or 3.4%, to $93.50.