MGM Mirage Says Short-Term Future Safe
After pushing senior lenders into a series of amendments to credit terms and a waiver of a major credit facility, MGM Mirage announced in a regulatory filing this week that it no longer considers itself questionable in its ability to continue functioning as a “going concern.”
MGM’s accounting firm, Deloitte and Touche, has dropped the startling language included in a filing earlier this year which revealed the gambling company’s precarious financial position. Resolving the CityCenter crisis and selling new stock and debt so as to retire maturing loans have left MGM in a far more stable position.
Still, the company faces future liquidity problems even with sufficient cash to address loans through 2010.
“I’m not sure where there’s the gold star here other than to say they’ve come back from the precipice of economic peril to a company that can focus on operations,” said Jeffrey Logsdon of BMO Capital Markets.
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