Thursday, May 21, 2009

Bellagio and MGM Grand Schnanegans

The wires are reporting that Kirk Kerkorian is making a bid to purchase the Bellagio from... well, himself (as he owns 56% of the MGM Mirage). Interesting timing with the WSJ reporting yesterday that the MGM is making an international play to build and manage branded luxury hotel properties around the world (which won't be casinos). When I read the article yesterday, it seemed to oddly contrarian for the company to make a play like this in an industry that is battling a horrible business travel climate and uncertain luxury leisure travel. But, upon hearing this, it makes a little more sense; if Kerkorian buys the crown jewels of MGM, than the company needs some other reason to exist.

I suppose, this is just a long way of saying that I wouldn't bet on Kerkorian buying the whole company and taking it private.

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