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MILWAUKEE - Shares of MGM Mirage fell on Wednesday as part of a broader market slump, even as the casino operator said its CityCenter Holdings LLC joint venture was delaying the opening of a project on the Las Vegas strip and changing portions of it that will lead to cost savings.
Shares of MGM fell $1.44, or 9 percent, to end at $14.52 Wednesday.
Earlier in the day, the Las Vegas-based company said its CityCenter joint venture with Infinity World Development Corp. has postponed the opening of its Harmon hotel and spa until late 2010. The complex also will no longer include a residential condominium part.
The Harmon originally had been designed to have about 200 residential units, with 88 already under contract to be sold. Those buyers will be entitled to refunds of their deposits, but also will be given the opportunity to buy units at the Mandarin Oriental Las Vegas, Vdara and Veer Towers, CityCenter said.
When finished, the Harmon will include about 400 rooms and suites, CityCenter said.
Construction of the Harmon's structure and exterior will be finished, while the completion of its interior will be postponed.
JPMorgan analyst Joseph Greff said in a note to clients that this lowers the overall cost by $200 million, which "will be well received by investors."
Of the cost savings, he said, "we find this to be a positive given the liquidity concerns we believe to be prevalent in MGM at present given considerable debt maturities and limited dry powder in the coming quarters."
Despite the news, the stock fell as part of a broader market slump Wednesday, caused by grim profit forecasts from several major companies and new evidence that unemployment is rising. The ADP National Employment Report, an unofficial gauge the market has been increasingly monitoring, said private sector employment fell by 693,000 in December, more than expected.
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Data is a real-time snapshot *Data is delayed at least 15 minutes