MGM Resorts Eyes Counterbid for Barry Diller's People Incorporated After Failed Takeover Attempt

In a striking role reversal, MGM Resorts is now exploring a bid to acquire Barry Diller's People Incorporated — the very company that just days ago tried to buy MGM. People Incorporated, formerly known as IAC, withdrew its own $12.4 billion takeover offer for MGM on Wednesday, and now MGM could counter with a proposal of its own within days, though a final decision hasn't been made.

The stakes are significant. People Incorporated carries a market cap of roughly $2.7 billion and owns a portfolio that spans People magazine, Food & Wine, Southern Living, a stake in car-sharing platform Turo, and the Daily Beast. Crucially, the company also holds a ~27% stake in MGM itself — a position built up during the Covid-19 pandemic when MGM shares were deeply discounted. That MGM stake alone is now worth approximately $2.5 billion, nearly matching People's entire market value, a disparity Wall Street reads as a sign that People's assets are being badly undervalued by the market.

MGM's own shares fell more than 10% Thursday after People pulled its takeover bid, pushing MGM's market cap to around $8.5 billion. The thinking among deal watchers is that an MGM acquisition of People could serve a dual purpose: allow MGM to effectively repurchase a massive block of its own shares while simultaneously acquiring People's other assets — publishing brands, minority stakes, and a cash cushion — at an attractive blended price.

Diller had pitched his original MGM bid partly as an AI hedge, arguing that doubling down on live events and gaming would insulate People from media industry disruption. That logic didn't attract enough equity partners, and he pulled the plug. But Diller left the door open to a deal, publicly signaling People remains interested in a strategic transaction with MGM. People has also been streamlining itself, rebranding from IAC and narrowing its focus to its publishing portfolio and the MGM stake — a posture that makes a clean transaction more plausible.