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November 26, 2015

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MGM Mirage says it needs more time to file annual report

In Today's Sun

MGM Mirage today said the company needs more time to file its 10-K, or annual report, so that it can assess the company's cash needs in light of the worsening economy and "instability in the capital markets."

Some observers expected MGM Mirage to seek an extension of time from the Securities and Exchange Commission to file this document, which was due Monday and is required of all companies with public stock.

In a SEC filing today, the company said it was evaluating the effect of its recent move to tap $842 million in remaining cash available under a $4.5 billion credit line.

MGM Mirage also said the company will likely default on its bank loan if the economy continues to decline, which could trigger immediate repayment of those and other debts. The company said it was attempting to seek a waiver from its banks to avoid such a scenario and that no such agreement was guaranteed.

"To ensure a thorough and up-to-date discussion of its financial position and liquidity needs, (MGM Mirage) expects to include additional information about its liquidity and financial position in its Form 10-K, including a detailed discussion of the impact of the matters described above," the filing continues.

Many investors viewed the cash withdrawal as a sign that the company will file for Chapter 11 bankruptcy in order to drastically reduce a mountain of debts coming due over the next few years. Reducing debts might free up cash that could be used to finish the company's half-owned CityCenter — money that is now going toward debt payments.

Delaying the company's annual report might also give MGM Mirage more time to come up with additional sources of cash, such as negotiating a property sale, observers say.

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