Diller walks from MGM, taking the takeover premium with him

MGM shares fell as much as 9% in after-hours trading the moment Barry Diller's People Inc confirmed it was pulling its $48.30-a-share offer, a deal that had valued the casino group at more than $18 billion including debt. Four months of negotiation produced no financing structure that worked: People wanted 50.1% control while bringing in outside equity partners and fresh debt, and Diller said plainly that the mix was never coming together. He keeps the 27% stake, roughly 66.8 million shares, so this is a retreat to spectator status rather than a full exit. MGM's board says it's happy running the business standalone, which is what boards always say the day a takeover premium evaporates.