In Brief


SAN FRANCISCO

Journal story suggests Yahoo may be takeover target again

Yahoo Inc.'s inability to snap out of a financial funk may be about to turn the embattled Internet company into a takeover target for the second time in less than three years.

That possibility, floated in a story posted online late Wednesday by The Wall Street Journal, lifted Yahoo's shares by nearly 13 percent in Wednesday's after-hours trading.

After snubbing a $47.5 billion buyout offer from the much larger Microsoft Corp. in 2008, Yahoo this time may find itself being courted by a smaller rival with its own problems, AOL Inc.

If Yahoo gets another offer, it will likely be for considerably less than what the company could have gotten had it embraced Microsoft. Yahoo's market value now is less than $25 billion, even after factoring in the run-up from the takeover speculation.

Standard & Poor's and Fitch revise ratings for MGM Resorts

Standard & Poor's on Thursday revised its outlook for MGM Resorts International as the casino operator proceeded with its plans to sell more than $500 million in stock to help pay down debt.

The ratings service changed its view of MGM Resorts to "stable" from "developing."

"The revision of the rating outlook to stable reflects some near-term improvement to MGM's still weak liquidity profile following the recent pricing of a primary common stock offering," Standard & Poor's credit analyst Ben Bubeck said in a statement.

Meanwhile, Fitch Ratings Service revised its outlook for MGM Resorts to "positive" because of the casino company's pending stock sale and other efforts to cut debt.

Fitch's Senior Director Michael Paladino said the $250 million-plus offer MGM Resorts received for its 50 percent stake in Atlantic City's Borgata was at a valuation toward the high end of Fitch's expected range.

He said a $125 million payment the company expects to receive this month from its MGM Grand Macau joint venture due to partial repayment of a loan also helps MGM Resorts' refinancing and capital raising efforts.

Also Thursday, New Jersey casino regulators approved the $73 million sale of land underneath the Borgata in Atlantic City as part of MGM Resorts International's exit from the nation's second-largest gambling market.

The state Casino Control Commission approved the sale of 11.3 acres to Vornado Realty Trust and Geyser Holdings through their newly formed company, New Jersey GL LLC.

WASHINGTON

Treasury bond yields push mortgage rates lower in week

Rates on 30-year mortgages fell this week to 4.19 percent, the lowest level in decades. They were pushed down by lower Treasury bond yields.

Investors are buying up Treasury bonds in anticipation of a move by the Federal Reserve designed to lower mortgage rates and yields on corporate debt.

As a result, the average rate for 30-year fixed loans dropped to the lowest level on records dating back to 1971, mortgage buyer Freddie Mac said Thursday. It's down from 4.27 percent the previous week. The last time rates were this low was in the early 1950s.

The average rate on 15-year fixed loans fell to 3.62 percent, the lowest on records dating back to 1991, Freddie Mac said.

 

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