The offer is a 12% premium to MGM's $49 closing share price onTuesday. In noontime trading today (Wednesday, Nov. 22) thecompany's share price stood at a 52-week high of $54.06, up morethan 10% on the day.

JP Morgan Securities gaming analyst Harry Curtis told clientsthis morning in an email that the offer "shows that Kerkorian seessignificant value in the shares, which we believe is largelyrelated to future development in Macau and Las Vegas. In the nearterm, it could also suggest that trends in Las Vegas are verystrong."

The $55 offer is a valuation that Curtis says he has "longthought as being a fair value for future cash flows" in 2007 and2008. The offer implies an 8.6x debt adjusted multiple on 2008EBITDA. "Looking forward, it suggests that there is further upsidebeyond $55 over the next 12-18 months," Curtis said, reiteratinghis Overweight rating.