MGM Resorts

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MGM Resorts ( MGM) made headlines last week when it announced it will take control of its Macau joint venture, a move that could ultimately pad its Hong Kong initial public offering.

The casino operator founded by billionaire Kirk Kerkorian said that partner Pansy Ho will sell as much as 23% of MGM China Holdings in an initial public offering and another 1% to MGM Resorts. This sale would boost MGM's stake in the company to 51%.

The move would leave Ho with a 29% stake, while a 20% stake would go to the public.

Pansy Ho, daughter of Chinese casino mogul Stanley Ho, would also purchase $300 million of MGM Resorts' convertible senior notes due 2015.

Gaining control would give MGM the opportunity to consolidate its Macau operations on its books.

"Most importantly ... we believe investors will be pleased with the new structure, given MGM has increased, rather than diluted, its ownership of the fastest growing asset in its portfolio," Santarelli wrote in a note following the announcement. "The ability to consolidate the MGM China results could potentially unlock some equity value given the pro forma improvement in total leverage ratios of the company."

When MGM reports its first-quarter results on May 4, any updates on its initial public offering of its Macau assets on the Hong Kong Stock Exchange will surely be of interest.

The company has not announced a date for the IPO, but reports have surfaced that it could happen as soon as May and could raise about $1 billion.

Investors will also be awaiting any updates on MGM's plan to build another property in Macau's Cotai area. The company is currently waiting for land rights from government officials.

For the quarter, Wall Street is expecting a loss of 19 cents a share on revenue of $1.51 billion.

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