The top gambling regulator in Nevada on Thursday delayed MGM Resorts MGM -0.55%
International stakeholder Barry Diller’s licensing after federal authorities launched insider-trading investigations into his share purchases of Activision Blizzard Inc.
Nevada Gaming Commission Chairwoman Jennifer Togliatti in a public meeting ordered that Mr. Diller’s application to be in the casino industry undergo “further fact-finding and investigation” by the state’s Gaming Control Board. The board’s staff investigates the backgrounds of executives and major shareholders who must be licensed to operate in the state’s gambling industry. State regulators determine applicants’ “suitability” to be licensed, and their regulations are intended to prevent corruption or criminal activity in the industry.
In 2020, Mr. Diller and his internet holding company, IAC/InterActiveCorp.
IAC 3.06%
said it had spent more than $1 billion for a 12% stake in MGM Resorts,
MGM -0.55%
in pursuit of the growing online gambling industry in the US IAC’s stake in the Las Vegas-based casino operator has since grown to about 14%.
Mr. Diller did not respond directly to a request for comment. In a statement, IAC said the matter was “simply delayed.” “We expect no issues with respect to Mr. Diller’s application nor with IAC’s,” the company said.
MGM Resorts didn’t immediately respond to a request for comment.
The Gaming Control Board recommended in a March 2 hearing that the Gaming Commission approve licensing for Mr. Diller, IAC as a company and Chief Executive Officer, Joey Levin. Mr. Diller and Mr. Levin are MGM Resorts board members.
The Wall Street Journal reported earlier this month that federal prosecutors and securities regulators are investigating large bets that Mr. Diller made—along with Alexander von Furstenberg and David Geffen—on Activision Blizzard Inc. shares, days before the videogame maker agreed to be acquired by Microsoft Corp.
on Jan. 18.
Barry Diller said he made a lucky bet on Activision Blizzard shares days before it agreed to be purchased by Microsoft Corp.; the Irvine, Calif., campus of Blizzard Entertainment.
Photo:
MIKE BLAKE/REUTERS
Earlier this month, Mr. Diller said that none of the men had material nonpublic information about the Microsoft-Activision deal, saying, “it was simply a lucky bet.” He said Mr. von Furstenberg had been “buying Activision stock prior to that and the thought was that Activision at some point would either go private, or would be acquired at some point,” Mr. Diller said.
Neither Mr. von Furstenberg, who is Mr. Diller’s stepson, nor Mr. Geffen have responded to requests for comment.
Shares of IAC were up about 3% at the market’s close Thursday. Shares of MGM Resorts were down a half-percent.
IAC’s digital holdings include brands like Care.com, The Daily Beast and Vivian Health. The company said it planned to use its expertise to help MGM Resorts grow into online gambling, which some industry executives and analysts have said could be a $40 billion market in the US
Ms. Togliatti said the applications would be delayed until an April commission meeting.
Write to Katherine Sayre at katherine.sayre@wsj.com
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Appeared in the March 18, 2022, print edition as ‘Barry Diller’s Nevada Gambling License Is Delayed.’
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