Online Gambling Outlook Secures MGM Resorts A $1 Billion InvestmentBillionaire Barry Diller's InterActive Corp Announced Monday It Purchased About 12% Of MGM Resorts |
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Despite reporting a 91 percent drop in revenue duirng the second quarter due mostly to the coronavirus-induced shut downs nationwide, MGM Resorts received a 10-figure investment from a prominent holding company.
InterActive Corp announced Monday that it bought a 12 percent stake, worth about $1 billion, in the Las Vegas-based gaming giant.
Despite a lack of revenue at its brick-and-mortar facilities, billionaire Barry Diller’s IAC, purchased the stake in MGM because of its outlook on the online gambling market.
“MGM presented a ‘once in a decade’ opportunity for IAC to own a meaningful piece of a preeminent brand in a large category with great potential to move online,” said Diller in a letter to shareholders.
According to a Fox Business report, Diller also stated that he had been looking to enter to online gambling space “for a while” and that the industry was worth $450 billion on a global scale. IAC is a New York-based holding company that owns brands in more than 100 countries.
With larger gambling hubs hurting as tourism declines and revenue drops from restrictions stemming from new safety protocols, the online space, where legal, has thrived.
While New Jersey casinos were shut down, Garden State online operators reached record levels of revenue and the state’s most successful online casino, Golden Nugget, recently secured a partnership in Michigan. The partnership will allow the company to operate in the state when its online gambling market is launched either later this year or early 2021.
In June, the most recent month with available data, New Jersey online casinos won $84.9 million from gamblers, sustaining all-time high levels, while Pennsylvania netted $55.8 million. According to some analysts, Michigan’s online gaming market is worth $650 million in annual revenue, roughly on par with Pennsylvania’s numbers.
West Virginia launched its online casino marketplace in late July. Online poker was also legalized in the bill that legalized online gambling, but has yet to launch.
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