Mandalay Resort Group to sell holding in Detroit casino

03/24/05 - newratings.com

NEW YORK, March 24 (newratings.com) – Mandalay Resort Group (MBG) Wednesday announced that it is selling a controlling stake in its MotorCity Casino for $525 million to an affiliate of Detroit businesswomen Marian Ilitch.

Ilitch which already owns a 25% stake in the casino has now agreed to acquire a 53.5% stake from the Mandalay Resort Group. Ilitch has also signed agreements to buy the remaining 21.5% from other minority investors. The sale of stake in MotorCity Casino by Mandalay Resort Group is in accordance with the requirements of the latter company’s proposed $7.9 billion acquisition by MGM Mirage (MGG). The deal between the two casino giants can only be completed after the sale of Mandalay Resort Group’s stake in MotorCity Casino, since Michigan law prohibits one entity from owning more than 10% of two casinos in Detroit. MGM Mirage owns Detroit's MGM Grand Casino. The two companies have decided to postpone the closing date of their merger from the end of the current quarter to June 30.