MGM Resorts International (MGM) stock fell to an 11-month low after billionaire founder Kirk Kerkorian sold 20 million shares, reducing his stake in the biggest Las Vegas Strip casino owner to raise cash.
The shares dropped $1.54, or 13 percent, to $10 at 4:15 p.m. in New York Stock Exchange composite trading. The close was the lowest since Sept. 7 and the percentage decline was the steepest since May 2009, as the wider market also fell. MGM Resorts has slid 33 percent this year through yesterday.
The sale trims holdings of 94-year-old Kerkorian’s investment company Tracinda Corp. to 23 percent, according to a U.S. regulatory filing today. He had held about 27 percent. Tracinda, based in Beverly Hills, California, said it raised $214.9 million in a block sale at about $10.74 a share.
Kerkorian is “raising cash to have fun with it,” MGM Resorts Chairman and Chief Executive Officer Jim Murren said in a phone interview. “His two passions in life are philanthropy and investing, and you have to have cash to invest cash.”
Kerkorian built his fortune by investing in industries such as airlines, movie studios and U.S. automakers. He built Las Vegas-based MGM Resorts into the biggest casino operator in the Nevada city, increasing its size by acquiring Mirage Resorts from rival Steve Wynn, as well as Mandalay Resort Group a few years later.
“He has great motivation to be supportive, but also to enjoy his life,” said Murren, speaking from Macau, China. “We are clearly and firmly under way in a recovery, and he remains after this sale our largest single shareholder. He will benefit along with all the other shareholders as this recovery unfolds.”
To contact the reporter on this story: Beth Jinks in New York at email@example.com
To contact the editor responsible for this story: Anthony Palazzo at firstname.lastname@example.org