LAS VEGAS (AP) – MGM Mirage Inc. has raised its bid for rival casino operator Mandalay Resort Group only days after its previous offer was rejected as insufficient, pushing ahead with its effort to create the biggest gambling company in the world.

MGM Mirage said Monday the two sides had agreed on “all material terms” of the revised $4.8 billion cash offer after intense weekend discussions.

Mandalay said it hadn’t entered an agreement but said the new terms would “offer significantly greater assurances of closing” for its shareholders. Mandalay will present the revised offer to its board Tuesday.

Under the latest offer, MGM Mirage would pay $71 per share in cash for Mandalay stock, up from its earlier offer of $68 a share.

MGM Mirage said the cash price represents a 30 percent premium over Mandalay’s closing share price on June 3, the day before the company’s initial offer was made.

Shares of MGM Mirage fell 60 cents to $47 while Mandalay shares lost 92 cents to $67.50 in afternoon trading Monday on the New York Stock Exchange.

John Mulkey, a Bear Stearns gambling analyst in New York, said it appeared Mandalay’s board would accept the deal.

“We believe that management for both companies hammered out their differences over the weekend,” Mulkey wrote Monday in an investor’s note.

In rejecting the previous bid on Friday, Mandalay’s president and chief financial officer Glenn Schaeffer said the terms had “asked Mandalay shareholders to bear a far disproportionate share of the risk” of the deal.

Any deal would need approval by federal regulators as well as by regulators in Nevada and other states in which the two have casinos.

This is the second high-stakes buyout effort orchestrated by 87-year-old billionaire Kirk Kerkorian, who controls MGM Mirage. Kerkorian bought casino developer Steve Wynn’s Mirage properties in 2000.

MGM Mirage’s properties include the MGM Grand, The Mirage and Bellagio. Mandalay owns and operates 11 casinos in Nevada, including Mandalay Bay, Luxor and Circus Circus.

A combination of the two companies would give MGM Mirage control of 10 properties on the Strip, owning about half the 73,000 hotel rooms of the world’s most lucrative gambling market. With more than $6 billion in revenues, the company would surpass rivals Harrah’s Entertainment and Caesars Entertainment.

MGM Mirage owns or operates 12 casinos in Nevada, New Jersey, Mississippi, Michigan and Australia, and has investments in two other resorts in Nevada and New Jersey. It has a 25 percent interest in British casino developer Metro Casinos Ltd.

Mandalay Resort Group has about 15,000 rooms on the Strip. It has ownership in other properties in Nevada, Illinois and Michigan, and owns a hotel-casino in Tunica County, Miss.

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On the Net:

MGM Mirage Inc.: http://www.mgmmirage.com

Mandalay Resort Group Inc: http://www.mandalayresortgroup.com/index.php

AP-ES-06-14-04 1340EDT