Jim Murren, long-time chairman/CEO of casino operator MGM Resorts International, is resigning and the company is anxiously forming a committee to find his replacement.
MGM announced the shocker on Wednesday, that Murren had told the company’s board of directors that he wants to step down from his roles as chairman and CEO “prior to the expiration of his contract.” No reason was mentioned for the early departure.
Murren informed he will continue at his post until a replacement is appointed. MGM has created a committee of independent directors which will work with a “nationally recognized executive search firm” to find and evaluate candidates to substitute Murren.
MGM’s official statement cited Murren saying that managing MGM was “the most rewarding and fulfilling experience in my professional career.” Roland Hernandez, MGM’s lead independent director was grateful to Murren for his long-time service and promised that the company would dedicate “significant attention and resources” to finding Murren’s replacement.
Since 1998, Murren has been with MGM and accepted the chairman/CEO roles in 2008, just when the US casino market started to feel the impacts of the global economic meltdown. By March 2009, the company’s shares plunged to only $2.33 but currently is at $33.66 and experienced a brief uptick in after-hours trading after MGM’s announcement before falling almost 3%.
As reported by calvinayre.com, Murren led a number of major changes at the company, one of which was the founding of the MGM Growth Properties real estate investment trust. MGM has been quickening the rate at which it sells off its real estate properties, which is providing hoard of cash but leaves the company coping with substantial rent obligations in perpetuity.
Also, Murren led MGM into the unaccustomed world of online gambling through the Roar Digital joint venture with GVC Holdings, UK-listed operator. Till now the results haven’t been too inspiring; however, it’s early days yet and MGM shareholders seem satisfied to let this bet ride for now.
Most significantly, Murren directed MGM’s extension into Macau via the MGM China joint venture, which remains a noteworthy contributor to MGM’s bottom line and aided the company through the excruciatingly slow recovery in Las Vegas and other regional US markets after the great recession.
Murren’s forthcoming exit means he possibly won’t be at MGM’s charge when the company finds out whether or not it has acquired one of the three available casino licenses in Japan. MGM has vowed to break the bank building a Japanese integrated resort, which is part of the reason it’s been so eager to part with its real estate for quick cash.
Murren’s exit may not affect many existing and ex MGM staff who were discharged as part of the company’s ‘MGM 2020’ plan, which entailed cutting 3% of its US workforce. Since this plan was disclosed less than a year after the company relished a $1.4b tax windfall, Murren’s decision to leave may have been driven after Christmas Eve visits by three ghosts cautioning him of his final fate if he didn’t amend his ways.