MGM Mirage ends debt exchange offer because not enough holders accept the deal

MGM Mirage ends debt exchange offer

LAS VEGAS — Casino operator MGM Mirage said Thursday that it has ended a debt exchange offer because not enough debt holders accepted the deal.

The offer gave holders the chance to exchange up to $782 million in 8.5 percent senior notes due in 2010 for up to $500 million in 10 percent senior notes due in 2016.

Only about $9.1 million of the notes had been tendered as of Wednesday. The minimum required for the offer was $25 million. Notes validly tendered and not withdrawn will be returned to their holders, the company said.

Las Vegas-based MGM announced the exchange offer in late August, and in September the company amended the offer in part to extend its expiration date.

On Sept. 17 the casino operator pushed the expiration date as well as the early participation and withdrawal dates to Sept. 30. MGM Mirage had just extended the early participation date a week earlier to Sept. 24 from Sept. 10. The initial expiration date was Sept. 24 as well.

The exchange had been seen as a way for MGM to refinance some of its heavy debt. MGM, which billionaire Kirk Kerkorian has a sizable stake in, had $12.3 billion in long-term debt as of June 30.

MGM and the casino industry have struggled as gamblers have pulled back sharply on their discretionary spending in the recession.

Shares of MGM Mirage fell 85 cents, or 7.1 percent, to $11.19 in afternoon trading. The stock has traded in a range of $1.81 to $27.71 over the last year.