LAS VEGAS-MGM Mirage will acquire Mandalay Resort Group in a $7.9 billion deal, the companies said Wednesday morning. The deal was signed by Mandalay after MGM upped its cash-per-share offer to $71, a 30% premium to Mandalay’s closing share price the day before MGM made its initial offer of $68 per share. The total value of the deal is approximately $7.9 billion, including $4.8 billion in equity, $600 million in convertible debentures and $2.5 billion in outstanding Mandalay debt. Completion of the transaction is scheduled for the first quarter of 2005.The acquisition will give the combined company 28 properties throughout Nevada, Mississippi, Illinois, Michigan and New Jersey. Moreover, its will give MGM a stranglehold on the Las Vegas Strip and the fifth largest convention center in the US. “The new company will prove an influential factor in the future of American entertainment,” says Mandalay chairman and chief executive Mike Ensign. Adds MGM president/CEO Jim Murren, “We are clearly bullish on Las Vegas and its potential…and believe the combination will better position us to meet the needs of a broad range of customers in an increasingly competitive regional and national gaming marketplace.”Mandalay Resort Group owns and operates 11 properties in Nevada: Mandalay Bay, Luxor, Excalibur, Circus Circus, and Slots-A-Fun in Las Vegas; Circus Circus — Reno; Colorado Belle and Edgewater in Laughlin; Gold Strike and Nevada Landing in Jean and Railroad Pass in Henderson. The company also owns and operates Gold Strike, a hotel/casino in Tunica County, MS. The company owns a 50% interest in several other casinos: Silver Legacy in Reno, Monte Carlo in Las Vegas, Grand Victoria in Elgin, IL, and MotorCity in Detroit, MI.MGM Mirage owns and operates 12 casino resorts located in Nevada, Mississippi, Michigan and Australia, and has investments in two other casino resorts in Nevada and New Jersey. Its portfolio of brands include: Bellagio, MGM Grand Las Vegas, The Mirage, Treasure Island, New York – New York, Boardwalk Hotel and Casino and 50% of Monte Carlo–all located on the Las Vegas Strip. At the California-Nevada border, it owns Whiskey Pete’s, Buffalo Bill’s, Primm Valley Resort and two championship golf courses. As well, it owns the Shadow Creek golf course in North Las Vegas; Beau Rivage on the Mississippi Gulf Coast; MGM Grand Detroit Casino in Detroit, MI; a 50% share of Borgata in Atlantic City. Internationally, MGM owns a 25% interest in Triangle Casino in Bristol, UK. Under the terms of the transaction, Mandalay will terminate its quarterly dividend, but the $0.27 per share dividend declared on June 2, 2004, will be paid on August 2, 2004, as previously announced. The transaction is subject to the approval of Mandalay shareholders and to the satisfaction of customary closing conditions contained in the merger agreement, including the receipt of all necessary regulatory and governmental approvals. Bank of America Corporation, Citigroup Inc., Deutsche Bank AG, JPMorgan Chase & Co. and Societe Generale Group acted as financial advisors and Morgan Stanley provided a fairness opinion to MGM MIRAGE. Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro, LLP and Fried, Frank, Harris, Shriver & Jacobson LLP served as legal counsel to MGM MIRAGE. Merrill Lynch & Co., Inc. served as financial advisor and Cravath, Swaine & Moore LLP served as legal counsel to Mandalay Resort Group.

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