MGM Mirage: Dubai World Lawsuit 'Without Merit'
March 24 2009 - 10:17AM
Dow Jones News
MGM Mirage (MGM) said the lawsuit from its joint venture partner
alleging the troubled casino operator breached the terms of their
$8.6 billion CityCenter development in Las Vegas is baseless.
Dubai World said Monday its Infinity World Development Corp.
unit is suing MGM for an undisclosed amount and asked the Delaware
Chancery Court to free it from making future payments and
fulfilling other obligations under its partnership deal with MGM
Mirage.
"The lawsuit filed yesterday by a subsidiary of Dubai World is
completely without merit. Dubai World is well aware of our written
commitment to meet our funding obligations and that MGM MIRAGE has
available cash to satisfy those obligations," said Alan Feldman, a
MGM spokesman, in an emailed statement overnight.
"MGM MIRAGE is ready, willing and able to fund its share of the
costs to complete CityCenter, including a required payment this
week," the statement said.
In the lawsuit, Dubai World blamed MGM for massive cost overruns
on CityCenter. Dubai World owns a 50% stake in the project and
controls about 9.4% of MGM Mirage shares.
The lawsuit came nearly a week after MGM's auditor raised doubts
about its ability to continue as a going concern amid a brutal
gaming environment and remarks by MGM Chief Executive Jim Murren
which described the company's relationship with Dubai World as
"outstanding."
-By A.D. Pruitt, Dow Jones Newswires, 201-938-2269,
angela.pruitt@dowjones.com