MGM Mirage May Use Assets to Back Loans, Avoiding Sales
Fear that its well-publicized problems may prevent it from getting fair value in any asset sale, MGM Mirage (MGM: 10.27 +0.49%) is now apparently hoping to use those assets as collateral to secure new loans instead.
Word from inside the casino gaming company is that several potential investors, including the previously named Colony Capital, are considering granting MGM a new mortgage backed by a casino.
Felicia Hendrix of Barclays Capital wrote,”We believe MGM favours keeping its assets and offering them as collateral to its current lenders or new senior lenders as opposed to asset sales.”
JPMorgan analyst Joseph Greff told clients MGM Mirage expects to find its answers within the next three months, and said the gambling operator would refuse to negotiate with potential buyers who would need to arrange financing, or have trouble with regulators reviewing gaming license applications.
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