MGM Resorts Stakeholder Barry Diller’s Gambling License Is Delayed by Regulator

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 U.S. IAC’s stake in the Las Vegas-based casino operator has since grown to about 14%.

Mr. Diller didn’t 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.

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 U.S.

Ms. Togliatti said the applications would be delayed until an April commission meeting.

Write to Katherine Sayre at [email protected]