MGM Mirage Said to Hire Morgan Stanley to Evaluate Casino Bids

MGM Mirage has hired investment bank Morgan Stanley to evaluate bids for regional casinos in Michigan and Mississippi, a person close to the gaming company said.

Potential buyers have expressed interest in combinations of the assets, said the person, who declined to be named yesterday because the discussions are private. Las Vegas-based MGM Mirage owns the MGM Grand Detroit, the Beau Rivage in Biloxi and the Gold Strike in Tunica.

Property sales would help lower debt and could aid MGM Mirage in finding a broader solution to issues that weigh on the company and its CityCenter joint venture on the Las Vegas Strip. Partner Dubai World has sued and asked to be relieved of its funding obligations, a move that threatens to throw the unfinished project into bankruptcy. MGM Mirage also risks default on its $7 billion senior credit facility.

Morgan Stanley spokesman Mark Lake didn’t return voice and e-mail messages left outside of business hours yesterday.

MGM Mirage , controlled by 91-year-old Kirk Kerkorian, is working to come up with a long-term plan to fund CityCenter by April 13. The project’s banks waived defaults for two weeks on the senior secured credit facility after MGM Mirage made a $200 million construction payment on March 27 that covered Dubai World’s half.

Los Angeles-based buyout firm Colony Capital LLC has held discussions with MGM Mirage and Dubai World that include a possible investment in CityCenter, a person familiar with the discussihons said on April 1.

Australian billionaire James Packer’s Melbourne-based gambling company, Crown Ltd., is discussing an investment alongside Colony, the Wall Street Journal reported on April 3. Last month, Crown called off a planned $1.75 billion takeover of Cannery Casino Resorts LLC, owner of three Nevada casinos and the Meadows racetrack near Pittsburgh.

CityCenter Funds

MGM Mirage and Dubai World are obligated to fund about $800 million more in construction costs before they can access a $1.8 billion loan to complete the project. MGM can provide its share, said company spokesman Alan Feldman.

“We have the money to complete CityCenter,” Feldman said today in an interview. He declined to comment on speculation regarding Packer’s role.

Geoff Kleeman, a spokesman for Melbourne-based Crown, didn’t return voicemail messages left by Bloomberg News after business hours. A Dubai World spokesman declined to comment.

MGM Mirage , the largest owner of casinos in Las Vegas with properties including the Bellagio, Luxor and MGM Grand, has seen cash flows decline as recession led the Strip to its biggest drop in gambling revenue on record last year.

The company won a two-month reprieve from banks on March 18 to come up with a debt restructuring plan after auditors questioned the company’s ability to stay in business.

Restructuring Plans

The covenant waivers on the company’s $7 billion bank-loan facility were contingent on MGM Mirage and Dubai World continuing to fund construction on CityCenter.

MGM Mirage is likely to pursue a combination of asset sales, bond buybacks, fresh secured loans and discounted debt exchanges, as well as raising new capital, Chief Executive Officer James Murren said in March. He completed the $775 million sale of the Treasure Island hotel on the Strip to investor Phil Ruffin in March.

The Beau Rivage and MGM Grand Detroit may fetch between $1 billion and $2 billion, the Wall Street Journal reported yesterday, citing analysts’ estimates.

[BUSINESS]Dubai Companies Raise $2.84 Billion to Refinance Debt

The Dubai Electricity & Water Authority, the state-owned utility, and the Dubai Civil Aviation Authority raised $2.84 billion in syndicated loans to repay their debt, making April a busy month for Gulf Arab debt issues.

Dewa received a $2.2 billion loan from 18 international and local banks to refinance maturing debt, it said in an e-mailed statement today. The details of the facility will be announced on April 8. Dubai Civil Aviation raised $635 million in an Islamic Ijara loan to repay $1 billion of its debt, the Dubai government said in a separate statement.

Abu Dhabi, the oil-rich emirate with the world’s biggest sovereign wealth fund, raised $3 billion on April 1 in its first sale of bonds in two years. Qatar, the world’s largest exporter of liquefied natural-gas, sold $3 billion of bonds on April 2 to fund companies hurt by the global credit crisis. These came after Borse Dubai Ltd. borrowed $2.5 billion in February to refinance a facility it used to buy stakes in Swedish exchange operator OMX AB and the London Stock Exchange.

Dubai and its state-owned companies borrowed $80 billion to finance its transformation into a regional financial and tourist hub and the collapse of global credit markets last year sparked fears the emirate would default on loan obligations. Dubai government companies need to repay $10 billion of bonds and syndicated loans in the remainder of the year, $7 billion in 2010 and $25 billion in 2011, S&P analyst Farouk Soussa said last month. This doesn’t include money owed by banks.

[WORLD]Obama promotes nuclear-free world

Barack Obama has outlined his vision of a world free of nuclear weapons in a major speech in Europe.

The US president called for a global summit on nuclear security and the forging of new partnerships to prevent the spread of nuclear weapons.

He said he hoped to negotiate a new treaty to end the production of fissile materials for nuclear weapons.

North Korea's "provocative" rocket launch earlier in the day underscored the need for action, he said.

[WORLD]Zimbabwe 'to re-engage with West'

Zimbabwe's new coalition government has adopted a 100-day renewal plan aimed at mending ties with the West after years of isolation under Robert Mugabe.

Ministers on a three-day retreat hammered out the plan which is meant to yield a new constitution by next year.

Restrictions on foreign media are due to be lifted and human rights restored.

Correspondents at the talks say there is some scepticism that such ambitious targets can be met in such a short space of time.

[WORLD]Gunmen seize Darfur aid workers

Gunmen have kidnapped two foreign aid workers in Darfur and are demanding a ransom for their release, Sudanese state media report.

Aide Medicale Internationale confirmed that two of its workers, a Canadian and a French national, were abducted in southern Darfur on Saturday night.

French officials say they are in contact with both the aid agency and the local authorities.

Canada has said it is seeking information on the incident.

[WORLD]Migrant bodies found in Pakistan

Pakistani police have found 44 bodies inside a shipping container in what appears to have been a failed attempt at human trafficking.

Some 150 people are said to have been inside the container, most of them Afghans. The victims suffocated.

A number of survivors are being treated in hospital in the city of Quetta, in Baluchistan province.

The container reportedly belongs to a firm supplying Nato in Afghanistan and the driver's whereabouts are unknown.

Pakistan mosque blast 'kills 20'

At least 20 people have been killed after a suicide bomber detonated a device at the entrance to a Shia mosque in north-east Pakistan, police say.

Dozens of others were injured in the blast south of the capital, Islamabad.

A religious congregation attended by upwards of 1,000 people was taking place at the mosque in the Chakwal area of Punjab province.

A day earlier eight paramilitary soldiers were killed in a suicide attack on an Islamabad security base.