Look, I love Vegas as much as the next guy. In fact, I can't wait to get back and sidle up to a poker table, or maybe try Lakes Entertainment's
Tuesday, the board of Mandalay Resort Group
You can't really blame MGM for going to the well to hook up with Mandalay, for, as fellow Fool Jeff Hwang recently pointed out, it is the sex kitten among the casino operators on the Vegas Strip. But can this marriage last? Well, unlike most shotgun weddings in the Nevada desert, these two actually dated before heading to the altar. MGM and Mandalay each own a 50% stake in the Monte Carlo resort, which recently helped put some sizzle into Mandalay's operating results.
But not all is well for the happy couple. Should the two be joined as expected, the result could be a $13 billion mountain of debt, almost twice that of the combined entity's annual projected revenue of $6.6 billion. As W.D. Crotty has reported, that makes The Donald's ailing Trump Hotels
Indeed, as Trump's experience proves, not much good can come from a debt load that heavy. So for MGM and Mandalay, the honeymoon could be very short. And their offspring -- new properties to be created on undeveloped land they own on the Strip -- may be forced to accept unattractive terms to finance future building.
I don't think there's much question that the MGM-Mandalay marriage will be consummated, resulting in a few very beautiful children who will bring more glitz and glamour to the Strip. But will this pairing make money for you, the investor? Don't bet on it. You'd be better off looking into some of these deals, uncovered by our Foolish analysts:
(NYSE:AGI)misfortune could be a break for you.
(NASDAQ:ASCA)turns pennies into profits.
(NYSE:HET)rakes in the dough.
Heading to Vegas for vacation this summer? Make sure you get clued in to the best deals on the Best Travel Spots/Tips discussion board. And before you put any money in play, check in with the Gamblin' Fools, or the gang at On Tilt, if poker is your game. Not yet registered to enjoy our Foolish community? No sweat, it's easy to give us a try.