There have been many interesting deals in the gaming industry over the last two years. But the industry has never had a deal that could match the size of Wynn Resorts (WYNN). Considering the swift fall of Steve Wynn, the probability of the casino titan being swallowed by a larger competitor kept looming for a while. And there has been news that MGM Resorts International (MGM) has shown interest in acquiring its long-time rival Wynn Resorts.
According to the reports by New York Post, the Las Vegas casino giant Wynn Resorts might get scooped by rival MGM Resorts. Discussion between the two is yet to be made official. Sources claim that interest from the latter came in the form of back-channel approaches. Though Matt Maddox is not against any deal, he may be willing to hold the sale just for the right price. However, the chances of Wynn being acquired by MGM remains high.
This latest move by MGM, however, contradicts CEO James Murren’s intentions, who claimed early this year that his company is not interested in bidding for Wynn Resorts. The latest development could partly be due to the fact that Steve Wynn’s exit from his CEO role after the sexual misconduct claims and selling off his entire stake in Wynn Resorts.
Wynn derives a huge percent of revenue from the world’s largest gambling hub-Macau, China—nearly 75 percent of revenue. The complication that MGM should consider before buying Wynn is that the all gaming license of Wynn may be canceled by China in 2022 and Wynn Resorts is one of those companies facing the threat. The risk further intensifies considering the ongoing trade war between the U.S. and China.
Though MGM seems to be a potential bidder, Wynn can even expect offers from Galaxy that has a market value of $37 billion and Genting. Apart from this, Caesars Entertainment, which recently rose from bankruptcy, would also be interested in grabbing Wynn’s Macau assets.