Barry Diller’s People Inc. offers $18 billion to buy MGM Resorts

Barry Diller’s media company, People Inc., has made a formal offer to acquire the remaining shares of MGM Resorts, valuing the casino and resort operator at over $18 billion. People Inc., which owns 26.1% of MGM Resorts, is proposing to buy the rest of the company at $48.30 per share in cash, representing a 10.6% premium over MGM’s closing price of $43.67 on the previous Friday.

People Inc., formerly known as IAC and owner of publications such as People magazine, began investing in MGM Resorts about six years ago. Diller highlighted the unique value of MGM’s real-world assets, including iconic Las Vegas properties like the Bellagio and Luxor, which he believes artificial intelligence cannot easily replicate or replace. “We began investing in MGM nearly six years ago because we believed it represented a rare kind of business: one with real-world assets that AI cannot easily replicate or disintermediate and exceptional digital growth opportunities. That conviction has only strengthened over time,” Diller said in a statement.

The offer follows a letter Diller sent to shareholders on April 28, in which he described MGM’s stock as “wildly undervalued” and indicated that People Inc. would sharpen its focus on its stake in the company. MGM’s shares rose more than 10% in premarket trading following the announcement, while People Inc.’s shares increased nearly 3%.

MGM Resorts, which owns about 40% of the Las Vegas Strip’s casino properties, has faced challenges with sluggish visitor numbers in Las Vegas. To offset this, the company has expanded its presence in China, including Macau, and grown its digital operations. Its BetMGM venture has become one of the leading online sportsbooks in the United States, tapping into a digital gambling market that analysts view positively.

People Inc. plans to finance the acquisition using cash on hand, along with additional debt and equity funding commitments. If the deal proceeds, MGM Resorts would become a private company under People Inc.’s control.

This bid adds to recent consolidation activity in the casino industry. Just last week, hospitality billionaire Tilman Fertitta announced a $17.6 billion takeover of Caesars Entertainment, signaling increased merger and acquisition interest in the sector.

MGM Resorts did not immediately respond to requests for comment on the offer.