Replies to post #1023 on MGM Resorts International (MGM)

[Mephistopheles]

Today has had crazy news from the Middle East. I am interested to see whats going to happen with this.

[eastunder]

Dubai Debt No Threat to MGM's CityCenter
By Jeanine Poggi 11/30/09 - 11:01 AM EST

NEW YORK (TheStreet) -- The restructuring of Dubai World won't impact MGM Mirage(MGM Quote) or its CityCenter development, according to experts.

A subsidiary of Dubai World owns 5.9%, or $275 million, of MGM's shares and 50% of CityCenter, which is set to open on Tuesday.

"Dubai World has already fully funded its entire capital commitment in CityCenter, so there is no risk there," J.P. Morgan analyst Joseph Greff, wrote in a note. "Should Dubai World look to sell its stake in CityCenter, MGM would have the right of first refusal to buy out Dubai World's stake."

Greff says one of the more realistic scenarios for Dubai World is that it would sell its stake in MGM to raise liquidity. "However, this is a relatively small amount in relation to what we understand to be Dubai World's global debt payments to be," he wrote.

MGM also calmed fears, saying the $8.5 billion CityCenter joint venture will not be detered by Dubai World's request to delay repaying billions in debt. "CityCenter is fully funded, on schedule and ready to begin welcoming guests," MGM representative Yvette Monet, said last week.