Los Angeles billionaire Kirk Kerkorian is on his way to becoming the undisputed king of Las Vegas.
The deal that would create the world's largest casino company appeared back on track Monday when Kerkorian's MGM Mirage and Mandalay Resort Group signaled that they had agreed on the terms of a $4.8-billion buyout.
If approved by the companies' directors and by antitrust regulators, MGM Mirage's proposed acquisition of Mandalay Resort would be the largest ever in the casino business.
It also would give the 87-year-old Kerkorian, MGM Mirage's majority shareholder, control of about half the business on the fabled Vegas Strip. The combined company's holdings would include 36,500 rooms, 22,000 slot machines and 1,050 gaming tables at the Bellagio, MGM Grand, Mandalay Bay Resort, Excalibur and seven other hotels.
In a city where legendary figures such as mobster Benjamin "Bugsy" Siegel and reclusive tycoon Howard Hughes have held sway, the publicity-shy Kerkorian would rule over the largest concentration of gambling power since Hughes' 1960s heyday.
"Kerkorian is a master strategist who sees the industry clearly, " said Hal Rothman, a University of Nevada, Las Vegas, history professor who has written extensively on the gaming industry. "He calculates his opportunities and pounces."
Analysts say the proposed deal ups the ante in the looming battle between MGM Mirage and Las Vegas trailblazer Steven Wynn, who sold his Mirage Resorts Inc. to Kerkorian four years ago for $4.4 billion.
Next spring, Wynn is set to open Wynn Las Vegas, a luxury resort at the north end of the Strip that will compete with the Bellagio and the Mandalay Bay for high-stakes players of table games such as blackjack, poker and baccarat.
Even without Mandalay Bay, MGM Mirage dominates the Strip's high-end business. But Robin Farley, an analyst with UBS Securities, said she expected Wynn to make inroads into that lucrative gambling market when his lavish new casino opened.
MGM Mirage's proposed buyout of Mandalay also sets up a battle between the north and south ends of the Strip -- the twin poles of the Vegas gaming scene.
At the north end, Wynn's $2.4-billion resort is expected to spark a renaissance in an area populated by second-tier, medium-budget properties such as the Stardust and Riviera. Three miles down Las Vegas Boulevard, meanwhile, MGM Mirage is hoping to create what may be the highest concentration of casinos in the world.
