MGM Resorts COO sheds $2.4m in stock as Entain M&A rumors swirl
Corey Sanders unloads 60,000 shares ahead of impending MGM business update
MGM Resorts International chief operating officer (COO) Corey Sanders has sold more than 60,000 shares in the US casino resort operator, netting a cool $2.4m, according to the latest Securities and Exchange Commission (SEC) filings.
Shares were sold at an average price of $40, with the MGM COO holding 231,498 shares directly, with another 36,465 held indirectly.
This latest sale marks Sanders’ third in the space of three months, following sales on January 6 of 10,000 shares and a similar sale of 20,000 shares in November 2022.
While it is not unusual for senior executives to liquidate share positions in order to raise funds, this latest sale comes just 24 hours before MGM and its US joint venture partner Entain update the market on the performance of the BetMGM brand.
Previous updates have seen the duo each pledge to invest more than $450m in the business, with an expectation of generating full-year 2022 revenue of $1.3bn and a US market share of 20%-25% in both igaming and sports betting.
BetMGM’s success in the US has led to repeated speculation that MGM might try to buy out its JV partner from the venture, via a direct purchase of Entain’s 50% stake in the business.
This speculation, which grew after MGM Resorts tabled an audacious £8.09bn bid to acquire Entain in January 2021, is seen by many as a move to secure full control of BetMGM, while also adding to MGM’s global ambitions.
Although that bid was ultimately rebuffed by Entain, rumors that MGM might make another bid have dogged the operator over the last two years.
MGM Resorts’ CEO Bill Hornbuckle fueled these reports in August when he suggested that a deal for BetMGM was being thought about “all the time” by the operator’s board of directors.
Last weekend, the Mail On Sunday newspaper claimed a return bid by MGM for Entain was “inevitable”, with a return bid potentially being made post-publication of the white paper into the Gambling Act 2005 review.
The white paper is expected to call for the implementation of swingeing restrictions on the UK gambling industry, including the implementation of maximum stake limits for online slots of between £2 and £5 and requiring operators to carry out “non-intrusive” affordability checks on customers.
The white paper is expected to see the creation of an impartial ombudsman to resolve customer grievances with online businesses and to curb underage gambling, there will be stricter age-verification checks.
These measures are widely expected to affect the value of UK bookmakers and casino operators alike, something which could play into the hands of MGM in any second bid.
If MGM was to table a bid, it would be the second high-profile move to acquire a European operator in the space of 12 months, following MGM’s $604m acquisition of Malta-headquartered operator LeoVegas in September 2022.