MGM China Holdings Ltd has issued a statement of its own in response to a shareholder’s open letter this week, claiming the company has no plans to restructure.
Snow Lake Capital, the Asian investment management firm that holds a 7.5% stake in MGM China, penned the letter on Wednesday calling for MGM Resorts International to sell 20% of its MGM China interest to either a leading Chinese consumer internet company or a travel and leisure company as part of a strategic initiative to better position both companies for future growth.
MGM Resorts is the majority shareholder in MGM China with a controlling 55.95% stake.
The letter outlined six key reasons for pursuing such a transaction while also proposing several potential investors that could “create a win-win transaction for all parties involved and deliver significant shareholder value to both companies.”
However, after MGM Resorts said Thursday it will take actions that are in the best interests of its shareholders, MGM China issued a statement of its own Thursday morning claiming it was not looking at any major adjustment to its ownership structure.
“The board of directors of the Company is aware of an open letter issued by Snow Lake Capital, an institutional investor and a shareholder of the Company, to the board of directors of MGM Resorts International, the Company’s controlling shareholder, on 6 January 2021, making recommendations on the shareholding structure and future development of the Company,” it said.
“The Board confirms that, as at the date of this announcement, the Company has no plans of restructuring. The Board will continue to communicate with the Company’s shareholders and operate the Company in the best interests of its shareholders and stakeholders, enhancing shareholder value and performance of the Company.”