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MGM Mirage Covers CityCenter JV Financing Payment

DUBAI - MGM Mirage has displayed good faith by covering Dubai World’s share of a $200 million financing payment on their troubled CityCenter joint-venture resort in Las Vegas, the Dubai-based company said on Saturday.

However, Dubai World did not say if it planned now, as a result of this show of commitment, to withdraw its lawsuit accusing MGM of a breach of contract on the project.

MGM made the $200 million payment on Friday, after its senior creditors agreed to let it repay the full amount without Dubai World’s help. MGM’s banks had originally required MGM and its partner – a Dubai World unit called Infinity World – each to pay a share of the financing costs. With the banks waiving this requirement, MGM has avoided, for now, defaulting on its loans and is able to continue work on CityCenter. The waiver, which expires on May 15, gives MGM more time to seek the additional funding necessary to finish CityCenter.

“Dubai World appreciates the support of MGM Mirage’s bank group in providing a waiver to its client that allows this payment,” Dubai World said in an e-mailed statement.

In its lawsuit last week, Dubai World asked the Delaware Chancery Court in the US to free Infinity World of all its funding obligations for CityCenter.

· rocel@khaleejtimes.com