Tuesday, September 25, 2007

MGM and Macau

Have you seen the move in the casinos stocks in Macau? WYNN, LVS and MPEL, have moved 50, 40 and 5 points since I talked about them the past month, or about 40% each. MGM (85.36) has just sat here the past month, as the stock has been capped by the tender of 14 million shares at $84 by Dubai World. Unless extended, the tender offer expired last night.

MGM's Macau casino opens in December. If Dubai World, doesn't get a full tender of MGM's shares, what will stock buyers do? They'll assume that 84 is a floor on the stock, because investors didn't want the cash for their shares, and the stock is now in the stronger hands of a long term strategic buyer. Watch the buyers now come into MGM, as they realize it is also a Macau play.

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