IAC increases stake in MGM Resorts to 16.5%
The digital media firm cited consumer demand and sports betting as a reason for the additional purchase.
Between August 11 and 23, IAC purchased shares in MGM Resorts International to the tune of about $41.7m, increasing its stake in the company to 16.5%.
Led by Barry Diller, IAC is a digital media firm and internet services company that backs assets like the Angi digital marketplace and Dotdash Meredith magazines like People and InStyle.
Two years ago, in the middle of a pandemic, is when IAC first bought into MGM Resorts.
At the time, IAC accumulated a 12% stake in the company for around $1bn.
Diller and IAC CEO Joey Levin wrote to shareholders: “Similar to Disney’s advantages over pure-play streaming companies with an iconic brand and multiple avenues to monetize the same intellectual property between streaming, theatrical releases, merchandise and theme parks. We believe MGM also is an aspirational brand, which could be delivered with daily accessibility and offer gaming consumers.”
In a shareholder letter on Aug. 9, Levin pointed to consumer demand at MGM Resorts properties explaining the resort saw “consistent strong demand from the leisure consumer and all-time high average daily room rates for Las Vegas.”
During an earnings call in May, Levin said: “We’ve learned a lot since we’ve been there. I’d say that the gaming business, both the online gaming business overall, which is both sports betting and i-gaming, has outperformed our expectations relative to when we came in.
“It’s grown really tremendously, and that growth is going to continue for a long time.”
MGM Resorts share prices have ranged between $27-$35 in July and August which is down from $45-$48 at the beginning of the year.
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