Susquehanna: ‘High Probability’ MGM Draws Higher Bids Beyond Diller’s $18B Offer

MGM Resorts International (NYSE: MGM) could face a bidding war beyond Barry Diller’s $18 billion takeover offer, with Susquehanna forecasting a high probability of a topping bid.

The Bellagio operator delivers second-quarter results after the close of U.S. markets tomorrow and if the numbers are strong, that could justify a competing bid to the $48.30 a share People offered on June 1, according to Susquehanna analyst Joseph Stauff.

Some analysts view Diller’s offer as too low, placing MGM’s true value between $55 and $60 per share—or higher. However, rival bids remain unlikely. Because People Inc. already controls a 26.1% stake, it can effectively block any competing takeover. Nearly two months after Diller unveiled his proposal, no rival suitors have emerged.

In that time, MGM hasn’t commented beyond saying it received the bid, though it has formed a special committee to evaluate the pitch.

Unlocking ‘Trapped Value’ at MGM

Stauff notes other bidders could get involved with MGM to unlock “trapped value” at the casino giant, sources of which include BetMGM and the MGM China business. The analyst also points to other mergers and acquisitions possibilities as a possible source of allure for another suitor.

Stauff also highlighted the Las Vegas Strip’s rising status as a “sports first” destination as another reason why MGM could land a competing takeover offer.

Sin City is already home to teams from two of the four major North American sports leagues with Major League Baseball slated to join the fray in 2028. The NBA is targeting the 2028-29 season for adding a team to Las Vegas.

As for unlocking value with MGM, MGM China may be one way of doing that. The Las Vegas-based company controls 56% of the Macau operator and there’s been some chatter that Diller himself would look to part with that entity as well as MGM’s Japan business if he’s successful in acquiring the company.

BetMGM is a different beast. Entain Plc (OTC: GMVHY) and MGM each own 50% of BetMGM, meaning the former has to be onboard with any value-unlocking efforts pursued by the latter.

Speaking of BetMGM

BetMGM reported second-quarter net revenue rose 3% year-over-year to $711 million, lifted by an 8% gain in iGaming. However, the operator warned full-year results will land at the low end of its guidance—targeting $2.9 billion to $3.1 billion in revenue and $300 million to $350 million in EBITDA.

Citing regulatory complexity and broader market pressures, BetMGM also delayed its timeline for reaching $500 million in EBITDA, a milestone originally targeted for 2027.

Whether the slowdown pressures 50% co-owner Entain to consider a divestment remains unclear. However, Jefferies analyst James Wheatcroft noted that at 7.1x EV/EBITDA, “we see zero value for BetMGM priced into Entain.”