The marquee and sign at an entrance to MGM Grand Hotel & Casino are showing messages after the resort in the Las Vegas Strip closed as the coronavirus continues to spread across the United States on March 17, 2020 in Las Vegas, Nevada.
Ethan Miller | Getty Images
Barry Diller’s IAC / InterActive said on Monday it had bought a 12% stake in MGM Resorts International for about $ 1 billion, sending the casino operator’s shares up 14%.
The investment comes at a time when the gambling sector has been devastated by restrictions on governments on the move due to the Covid-19 pandemic, as well as fears about public meetings.
MGM reported a 91% drop in revenue in the last reported quarter and has reduced its dividend to warm the impact of the health crisis on its finances. Shares of the company have sunk more than 35% this year.
MGM’s online gaming company, which currently accounts for a small portion of its turnover, was what initially attracted Diller, the billionaire shareholders said in a letter.
“MGM presented a ‘once in a decade’ opportunity for IAC to own a significant piece of a leading brand in a large category with great potential to move online.”
Diller added that he has been following the online gaming space for a while, looking for an opportunity to enter the $ 450 billion global sector.
IAC has a history of building companies and it later split into separate companies – travel group Expedia Group and ticket booking site Ticketmaster are a few examples.
Shares of IAC, which recently completed separation from Match Group into a separate company, fell to about 1% after the news.
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