Thursday, Sept. 25, 2003 | 11:16 a.m.
Studio may buy back shares
Metro-Goldwyn-Mayer Inc., the film studio controlled by billionaire Kirk Kerkorian, said Wednesday it may buy back shares or expand the company's share repurchase program.
MGM will take into account the existing offer of Kerkorian's Tracinda Corp. to buy 15 million shares of MGM at $16 a share, the company said in a statement. Tracinda, which owned 67 percent of MGM as of February, last month began its cash purchase of as many as 15 million shares.
MGM said that no decision had been made on the size, timing or price of a share repurchase program and that its management wouldn't make a decision until after the completion of Kerkorian's offer. The Los Angeles-based company also said it intends to continue to have shares outstanding after repurchases.
Chief Executive Alex Yemenidjian said in July that if the company were not successful in its bid to acquire the U.S. entertainment assets of Vivendi Universal SA, it "would reward shareholders by sharing wealth with them." MGM withdrew its $11.5 billion offer in July for the Universal assets.
MGM has bought about 7.5 million of its shares under a 10 million share repurchase program, spokesman Joe Fitzgerald said.
Kerkorian also controls the MGM MIRAGE casino resort company.
Resort posts $2.5 million loss
The Aladdin hotel-casino, citing soft table play in its casino, lost $2.5 million in August, according to a report it filed with the U.S. Bankruptcy Court in Las Vegas Tuesday.
The Aladdin, which filed for Chapter 11 bankruptcy protection two years ago this month, had revenue of $20.7 million for the month and expenses of $22.7 million. The company also reported reorganization expenses totaling $500,243 for the month.
In August 2002, the company reported a loss of $683,851 on revenue of $20.6 million, expenses of $20.7 million and reorganization expenses of $148,583.
A spokeswoman for the company said that despite the loss, the company is continuing to show good cash flow, which was $3.8 million for the month. In July, the company reported cash flow of $4.6 million and in August 2002, it was $4.1 million.
Tyri Squyres said the average daily hotel rate was $99.95 compared with $94.08 for the same month a year ago. For August 2003, the occupancy rate was 99.4 percent.
Squyres said that although table play was off, slot machine play was strong at the Strip hotel-casino.
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