Published on: April 8, 2026, 11:09h.
Updated on: April 8, 2026, 11:09h.
- IAC, led by Barry Diller, has agreed with MGM Resorts on a voting arrangement that will restrict the media firm’s influence in specific situations
- IAC will receive two guaranteed seats on MGM’s board in return
- Currently, IAC holds about 23% of MGM’s shares
IAC/InterActiveCorp (NASDAQ: IAC), under the leadership of Barry Diller, has formed a voting agreement with MGM Resorts International (NYSE: MGM), which will restrict certain influences the media company possesses over the gaming operator.
Essentially, as MGM’s top shareholder, IAC has consented to vote its shares in alignment with the overall voting trends of other MGM investors, as outlined in a Form 8-K filing with the SEC.
According to the Voting Agreement, whenever a matter is presented for a vote at an annual or special meeting of the Company’s shareholders (or in relation to any proposed action by shareholders in lieu of a meeting), IAC, Mr. Diller, and their associated affiliates (collectively referred to as ‘Covered Entities’) will vote any of their beneficially owned voting securities exceeding 25.73% of the total voting rights of the outstanding securities of the Company (the ‘Excess Voting Securities’) in proportion to how the other shareholders vote on those matters (excluding those who do not participate in voting),” as stated in the regulatory filing.
This indicates that Diller and IAC could potentially control over 25.73% of MGM’s voting assets.
IAC’s Increasing Shareholding in MGM
IAC’s initial acquisition of a 12% share in MGM, valued at $1 billion back in August 2020, has nearly doubled as Diller’s company has augmented its holdings, coupled with MGM’s significant reduction in the number of shares outstanding through buyback programs.
In two transactions at the end of March, IAC purchased a total of one million shares of the Bellagio operator, raising its stake in MGM to approximately 23%. This move was anticipated, as Diller had previously indicated that IAC would consider expanding its investment in MGM.
It is speculated—though not confirmed—that this voting agreement was established as a proactive strategy to mitigate any potential activist maneuvers by Diller and IAC. While Diller has not publicly revealed any activist plans during his time as an MGM investor, rumors suggest he may have expressed dissatisfaction regarding the stock’s performance behind closed doors.
Potential Termination of the IAC/MGM Agreement
There are conditions under which this voting agreement could be nullified. The agreement could be terminated if IAC and its affiliates hold less than 17.5% of MGM shares or should the MGM board fail to nominate the two directors selected by IAC.
This accord includes a guarantee of two board seats for IAC, which are currently occupied by Diller and former IAC CEO Joey Levin, both of whom serve on MGM’s board of directors.
The Diller entities, excluding IAC and its “controlled affiliates,” will not be constrained by the voting limitations concerning any Excess Voting Securities, and they will no longer be categorized as Covered Entities once both of these conditions are met: (i) Mr. Diller ceases to serve as either the Chairman of IAC’s Board or as a Senior Executive of IAC; and (ii) the Diller entities own less than one-third of the total voting power of the outstanding voting securities of IAC,” as detailed in the SEC filing.