Diller MGM Bid Low, Limited Scope for Competing Offers, Say Analysts
Posted on: June 2, 2026, 01:31h.
Last updated on: June 2, 2026, 01:31h.
- Diller’s People Inc. is offering $48.30 a share for the casino operator, but the stock trades above that price
- There are no guarantees MGM will accept the offer
- Analysts say it’s hard to envision competing bids emerging
On Monday, Barry Diller’s People Inc. (NASDAQ: IAC) revealed a $48.30 a share acquisition offer for MGM Resorts International (NYSE: MGM), valuing the casino operator in which the suitor already owns 26% at $18 billion, but there’s some belief that bid is low. The issue is the difficulty rival bidders face in potentially besting Diller’s proposal.
Shares of MGM closed at $50.69 yesterday, suggesting some market participants view the casino stock as worth more than Diller’s offer. Prior to the formal release of the MGM acquisition proposal, there was sell-side chatter indicating that the terms of Tilman Fertitta’s bid $17.6 billion to acquire Caesars Entertainment (NASDAQ: CZR) implied MGM was worth $55 to $60 a share, or maybe more based on that deal’s 6.6x enterprise value (EV)/ earnings before interest, taxes, depreciation, amortization, and restructuring or rent costs (EBITDAR) multiple. Diller’s pitch for MGM implies an EV/EBITDAR multiple of 5.5x.
At 6.6x, MGM’s valuation would be $69/share (based on our 2027E). That said, we think the market understands that MGM is a fairly complex business with several moving parts which could make it difficult for a true ‘apples to apples’ comparison,” observes Truist Securities analyst Barry Jonas.
He has a $55 price target on MGM.
Diller MGM Bid ‘Too Conservative’
Las Vegas-based MGM, the largest casino operator on the Strip, acknowledged receipt of Diller’s proposal while cautioning investors “it cannot provide assurances that such proposal or any subsequent proposal will result in an agreement or a transaction being reached or, if so, as to the timing, price or other terms and conditions of any such agreement.”
Translation: MGM has an offer in hand, but it hasn’t outright accepted or rejected it. Conversely, Diller likely knows, and analysts agree, that with control of 26% of MGM shares, he’s unlikely to face competing bid. Stifel analyst Steven Wieczynski, who called Diller’s offer “too conservative”, acknowledges that given Diller’s existing MGM stake, it’s hard to envision a private equity suitor coming forward with better terms.
Still, the analyst argues that Diller’s proposal doesn’t adequately reflect the value of MGM’s 56% stake in MGM China (Macau exposure), the operator’s podium positioning with higher-end Strip integrated resorts and the opportunity set afforded by the upcoming Osaka casino resort. The analyst also drew Caesars comparisons of his own.
“We would also note that CZR’s accepted offer price (which received meaningful pushback from investors) reflected an almost 50% premium to the stock’s 30-day weighted average closing price (for the period before rumors of the deal were reported), essentially double that of People’s bid for MGM (~24% premium),” notes Wieczymski. “With this context, we find it hard to believe that long-term MGM shareholders or Board will be overly excited about $48.30/share.”
Tough to Bet on More MGM Suitors Coming Forward
Today, MGM’s stock retreated to levels only modestly above Diller’s $48.30 a share offer, potentially indicating market participants are reconciling the difficulty of another suitor coming over the top. However, that doesn’t mean MGM can’t or won’t counter.
Still, with Diller’s media company ranking as MGM’s largest shareholder and with control of two board seats at the casino operator, other prospective acquirers may opt to stay on the sidelines.
“Should competing bidders emerge, we would expect a challenging path given the voting influence held by Diller,” says David Katz of Jefferies.
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