MGM Resorts amends voting pact with People Incorporated and Barry Diller

People and Diller agree to cap their combined stake at 29.9 per cent of outstanding shares and to vote with the board on a change of control, subject to conditions.

MGM Resorts International has amended its voting agreement with People Incorporated and Barry Diller. The change follows People's withdrawal of its earlier proposal to acquire the company.

Under the amendment, People, Diller and their associated entities agree not to raise their combined stake above 29.9 per cent of outstanding shares. In a change of control vote, they will vote in line with the board's recommendation, subject to certain conditions. MGM agrees not to adopt defensive measures against them for as long as they stay in compliance.

Paul Salem, chairman of the MGM Resorts board, said the agreement "provides the Board with a clear path to maximize value through share repurchases and a change of control transaction, if applicable."

The amendment turns a withdrawn acquisition approach into a standing governance framework. Because the 29.9 per cent ceiling is measured against outstanding shares, buybacks would change the number the cap applies to. The commitment to vote with the board on any change of control, and the pledge against defensive measures, could move influence toward the board in a future deal. Whether that leads to repurchases, a sale or neither depends on how the stated conditions play out.