MGM Resorts explores acquiring People Incorporated after deal collapse

Longleaf Partners, a fund managed by Southeastern Asset Management, reported that MGM Resorts is considering an acquisition of People Incorporated (NASDAQ: PPLI) following the withdrawal of a prior takeover bid. The fund disclosed this development in its third-quarter 2026 investor letter for the Partners Fund, noting that People Incorporated had previously announced it was pulling its offer to acquire a majority stake in MGM Resorts. This reversal, combined with weaker recent trends in Las Vegas, caused MGM Resorts stock to sell off to a price far below its level prior to the People Incorporated offer. The news of a potential reverse acquisition emerged the day after People Incorporated withdrew its bid.

In the letter, Longleaf Partners stated that it continues to believe it makes sense for the two companies to combine and that such a merger could be value per share accretive. The firm noted that the main questions surrounding a deal likely revolve around the value and future of People Incorporated's assets, excluding the MGM shares currently held. Longleaf Partners expressed confidence that there are creative ways to structure the new company and stated that it remains engaged with both companies to help reach an agreement.

People Incorporated was a detractor in the fund's portfolio during the third quarter, alongside MGM Resorts. Despite this, Longleaf Partners maintains a higher weighting in People Incorporated than in MGM Resorts. Earlier in the quarter, People Incorporated released what the fund described as a good earnings report that highlighted the company's continued progress toward simplifying its operations. In contrast, MGM Resorts posted a decent quarter where its Regionals division recorded all-time high revenues and Las Vegas grew revenues for the second consecutive quarter.

As of October 20, 2026, People Incorporated closed at $39.32 with a market capitalization of $2.93 billion. The stock experienced a 0.56% pullback year to date and traded within a 52-week range of $29.56 to $48.32. The fund noted that while some stocks in its portfolio have seen earnings disappointment, long-term values remain intact and that groups within the portfolio experience disconnects between earnings growth and stock performance.

The Partners Fund returned 2.41% in the third quarter and -3.15% year to date, compared to 2.30% and 12.75% for the S&P 500, respectively. The fund's three-year annualized returns stood at 11.7% coming into the year. Longleaf Partners attributed recent market impacts to macro factors including higher interest rates but maintained that financially strong investments are expected to endure. The firm reported that its portfolios' earnings multiples have decreased, presenting opportunities despite current frustrations, and remains optimistic about future returns.