Diller's $18 Billion MGM Buyout Bid Faces Legal Scrutiny

Barry Diller's People Inc. is pressing an $18 billion bid to take MGM Resorts International private at $48.30 per share, and the proposal is now drawing legal attention. A securities law firm said this month it is investigating potential conflicts of interest in the deal, noting that Diller sits on MGM's board while People Inc. already holds roughly a 26% stake in the casino operator.

MGM has formed a special committee of independent directors to evaluate the unsolicited offer, first made June 1, with reports indicating talks have advanced in recent weeks. The investigation centers on whether fiduciaries standing on both sides of the transaction could receive benefits not shared by ordinary stockholders under Delaware law.

MGM shares traded in the mid-$44 range late last week, below the offer price, suggesting investors are weighing both the odds the deal closes and the possibility of a sweetened bid.