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Starboard building stake in MGM Resorts - sources


By Herbst-and Greg Roumeliotis

(Reuters) - Activist hedge fund is building a stake in MGM Resorts, two people familiar with the matter said on Thursday, as the U.S. hotel and casino operator comes under investor scrutinty over its profit targets.

is aware of Starboard's investment, the sources said, asking not to be identified because the matter is confidential. Starboard's strategy for targeting MGM could not be immediately established.

"The company does not comment on market rumors", said in a statement. Starboard did not respond to a request for comment.

shares rose 2 percent to $28.19 on the news, giving the company a market capitalization of $15 billion. The stock is down 17.4 percent over the last 12 months.

MGM Resorts has a portfolio of 28 hotels around the world, including in and

Last week, MGM Resorts announced a plan to cut costs and boost growth. It said it expected to increase its annualized adjusted earnings before interest, taxes, depreciation and amortization by $300 million by the end of 2021.

MGM Resorts' smaller peer, Caesars Entertainment Corp, rejected a merger approach by Tilman Fertitta, the billionaire owner of the Golden Nugget Casinos, last year.

(Reporting by Herbst-and Greg Roumeliotis; Editing by and Susan Thomas)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, January 10 2019. 22:07 IST