Traders bid up
shares in Wednesday's premarket session after the movie studio confirmed that management plans to recommend the payment of a special $8 dividend.
The action comes at the behest of the company's largest shareholder, Las Vegas billionaire Kirk Kerkorian, who owns about 75% of MGM's 235.4 million outstanding shares. He'll therefore receive about $1.41 billion of the total $1.88 billion implied in the $8-a-share outlay.
According to a press release, MGM's management will make the recommendation after the company completes the refinancing of its credit facility, which is expected by the end of this month. The company noted there's no guarantee the board will accept the recommendation.
MGM shares were recently trading up $1.12, or 6.4%, to $18.60 on the Instinet premarket session.