MGM investor picks up a larger chunk of the company
Corvex Management ups its stake in the casino company
Corvex Management, an investor of MGM Resorts International, has decided to increase its stake in the company that owns 14 casinos along the Las Vegas Strip. This isn’t unusual, as investments are increased or reduced all the time. However, what makes this one different is that Corvex is owned by Keith Meister, a director of MGM. Perhaps he knows something most everyone else doesn’t.
The hedge fund spent $75.2 million to buy an additional 2.97 million MGM shares across a three-day period, June 5-7. It now owns a total of 18.56 million shares, which represents a 3.5% stake in the company. Corvex purchased 1.13 million shares on June 5, another 954,000 the following day and, lastly, 782,000 on June 7. It had to pay $25.82, $26.38 and $26.44, respectively, per share to increase its holdings.
Meister, who was appointed as a director this past January, is an independent director of MGM’s real estate committee, similar to Paul Salem. Salem has also gone on an MGM shopping spree, purchasing 800,000 shares valued at $20.3 million about a month ago.
The purchase comes as MGM continues to hand out pink slips like they were candy. The casino operator is looking to eliminate around 2,000 positions and is already almost halfway there. The goal is to look for ways to save money after going on a multibillion-dollar shopping spree over the past couple of years, and is part of CEO Jim Murren’s “MGM 2020” plan.