Daniel Och Says Owning MGM ‘Good Thing’ at Some Point
3:33 PM Posted by MH
By Gillian Wee and Jonathan Keehner
April 29 (Bloomberg) -- MGM Mirage, the casino operator controlled by billionaire Kirk Kerkorian, has “probably the best assets on the Las Vegas Strip” and owning those would eventually be a “good thing,” Daniel Och, founder and chief executive officer of Och-Ziff Capital Management Group LLC, said.
“At some point coming out of the cycle, owning the best assets on the Las Vegas Strip would be a good thing to do,” Och said at the Super Return private-equity conference in Miami.
MGM Mirage, based in Las Vegas, is considering asset sales, debt buybacks and other steps to avoid default on its $7 billion senior-credit facility. The company faces a May 15 deadline to restructure its finances or risk defaults that could trigger bankruptcy. MGM Mirage sold its Treasure Island hotel to investor Phil Ruffin last month for $775 million.
MGM Mirage rose 37 cents, or 6.4 percent, to $6.17 at 12:18 p.m. in New York Stock Exchange composite trading. Och-Ziff shares rose 71 cents, or 9.9 percent, to $7.90.
The hedge-fund firm is seeking investments in distressed assets and also likes corporate credit and mortgage-backed securities, Och said.
General Growth
“We will be careful to stay away from mediocre or less and focus on the strong,” Och said. “General Growth Properties, some of the assets they have are extremely good.”
General Growth Properties Inc., based in Chicago, filed the biggest real estate bankruptcy in U.S. history on April 16 after amassing $27 billion in debt during an acquisition spree that turned it into the second-largest shopping mall owner.
Och declined to comment further on MGM and General Growth.
Och-Ziff earlier this month said client assets declined $2 billion, or 9 percent, to $20.3 billion in March even as its hedge-fund returns increased. Och-Ziff’s biggest fund, the OZ Master Fund Ltd., gained 4.4 percent on investments this year through March 31, the New York-based company said in a regulatory filing. The fund, which lost 16 percent last year, rose 0.9 percent in March.
Assets at Och-Ziff tumbled 33 percent in 2008 on losses and client withdrawals. Investor redemptions in the $1.2 trillion hedge-fund industry reached about $260 billion last year and funds lost an average of 19 percent, the most since Chicago- based Hedge Fund Research Inc. started keeping data in 1990.
Steve Wynn, chairman of Wynn Resorts Ltd., said on April 28 that he is interested in buying some of the casinos owned by MGM Mirage.
To contact the reporters on this story: Gillian Wee in New York at gwee3@bloomberg.net; Jonathan Keehner in New York at jkeehner@bloomberg.net. Last Updated: April 29, 2009 12:21 EDT
“At some point coming out of the cycle, owning the best assets on the Las Vegas Strip would be a good thing to do,” Och said at the Super Return private-equity conference in Miami.
MGM Mirage, based in Las Vegas, is considering asset sales, debt buybacks and other steps to avoid default on its $7 billion senior-credit facility. The company faces a May 15 deadline to restructure its finances or risk defaults that could trigger bankruptcy. MGM Mirage sold its Treasure Island hotel to investor Phil Ruffin last month for $775 million.
MGM Mirage rose 37 cents, or 6.4 percent, to $6.17 at 12:18 p.m. in New York Stock Exchange composite trading. Och-Ziff shares rose 71 cents, or 9.9 percent, to $7.90.
The hedge-fund firm is seeking investments in distressed assets and also likes corporate credit and mortgage-backed securities, Och said.
General Growth
“We will be careful to stay away from mediocre or less and focus on the strong,” Och said. “General Growth Properties, some of the assets they have are extremely good.”
General Growth Properties Inc., based in Chicago, filed the biggest real estate bankruptcy in U.S. history on April 16 after amassing $27 billion in debt during an acquisition spree that turned it into the second-largest shopping mall owner.
Och declined to comment further on MGM and General Growth.
Och-Ziff earlier this month said client assets declined $2 billion, or 9 percent, to $20.3 billion in March even as its hedge-fund returns increased. Och-Ziff’s biggest fund, the OZ Master Fund Ltd., gained 4.4 percent on investments this year through March 31, the New York-based company said in a regulatory filing. The fund, which lost 16 percent last year, rose 0.9 percent in March.
Assets at Och-Ziff tumbled 33 percent in 2008 on losses and client withdrawals. Investor redemptions in the $1.2 trillion hedge-fund industry reached about $260 billion last year and funds lost an average of 19 percent, the most since Chicago- based Hedge Fund Research Inc. started keeping data in 1990.
Steve Wynn, chairman of Wynn Resorts Ltd., said on April 28 that he is interested in buying some of the casinos owned by MGM Mirage.
To contact the reporters on this story: Gillian Wee in New York at gwee3@bloomberg.net; Jonathan Keehner in New York at jkeehner@bloomberg.net. Last Updated: April 29, 2009 12:21 EDT
April 29, 2009 at 4:02 PM
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