MGM Next Domino to Fall? Casino Stock Soars on Diller Takeover Bid
Posted on: June 1, 2026, 09:26h.
Last updated on: June 1, 2026, 09:26h.
- MGM stock soars as Barry Diller offers $18 billion for the casino operator
- Diller’s People Inc. is the largest MGM shareholder
- Offer emerges just days after Tilman Fertitta launched a bid for Caesars Entertainment
Shares of MGM Resorts International (NYSE: MGM) surged in early trading after Barry Diller’s People Inc. (NASDAQ: IAC) revealed a $48.30 per share takeover offer, valuing the casino giant at $18 billion, “to acquire all outstanding shares of MGM” the suitor doesn’t currently own.
Diller’s media conglomerate, previously known as IAC/InterActiveCorp, is already MGM’s largest shareholder, controlling 26% of the casino stock. People’s offer for MGM represents a 24.1% premium to the volume-weighted average price of the shares for 30 trading days that ended on May 29 — the final trading day of May. The $48.30 per share bid is also 10.6% above where the stock closed on that day while implying a valuation that’s more than 30% above the stock’s volume-weighted average price over the 90-day period ending May 29.
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,” said Diller in a statement.
Then IAC, Diller’s company started what was then a 12% stake in MGM in August 2020, then valued at $1 billion.
Diller: Market Is Undervaluing MGM. Is He Doing the Same?
Diller’s offer for MGM emerges just four days after Tilman Fertitta bid $17.6 billion to acquire Caesars Entertainment (NASDAQ: CZR) — a move many analysts expected would touch off a new round of casino industry consolidation.
In the statement, Diller reiterated his long-held view that MGM is mispriced, noting “the market materially undervalues the power and durability of MGM’s assets.” However, some analysts and investors may argue he too is undervaluing the target.
As momentum for the Caesars/Fertitta marriage built, some analysts speculated that the then rumored takeover price of Caesars implied MGM is worth $55 to $60 a share, but People Inc.’s $48.30 per share bid is clearly well below the $57.50 midpoint of that range. That comes on the heels of Fertitta offering $31 a share for Caesars when rumors previously suggested he’d bid as much as $34 a share.
“People Incorporated expects to fund any transaction with a combination of existing cash on hand at People Incorporated and MGM and additional debt and equity funding commitments,” according to the press release. “People Incorporated expects that it will own just over 50.1% of the equity of the company, with other investors (which may include existing shareholders of MGM) holding minority interests. People Incorporated would control the MGM business.”
People Inc. Could Oppose Other MGM Takeover Bids
In April, then IAC and MGM reached an agreement under which the media conglomerate’s sway at the casino would be limited select circumstances. It’s likely that a competing takeover offer is not one of those instances. In a letter to MGM’s board, Diller makes clear People Inc. wouldn’t vote in favor of an acquisition offer floated by a third party.
“We wish to confirm to you that People Incorporated has no intention to sell our existing ownership stake in MGM, or to pursue or vote in favor of any merger or other similar extraordinary transaction that would result in a change in control to another party or dilute in any meaningful respect our economic and voting interest in MGM,” wrote the media mogul.
Diller and former IAC CEO Joey Levine are members of the MGM board of directors.
Should the Diller/MGM and Fertitta/Caesars proposed marriages make it to the altar, the result would be the two largest operators on the Las Vegas Strip being private companies, leaving public investors with limited options for expressing their views on the US casino center.
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