MGM MirageThe glitter of the Strip in Las Vegas is shining a little dimmer today, as the recession has raked a big stack of chips off the gaming table and left some key players struggling to pay up. Kirk Kerkorian's MGM Mirage (MGM) in particular is in danger of being taken for a long ride into the desert.

The Wall Street Journal (subscription required) reports that talks with a potential angel, Colony Capital LLC, which could help cover the company's massive debt, have collapsed. MGM, owner of the Bellagio, Mirage, Mandalay Bay and other Las Vegas casinos, as well as properties in Detroit, Mississippi, and half of the MGM Grand Macau in China, faces $13.5 billion of debt as well as payments due on its 50 percent share of the CityCenter development. It has tapped out its senior credit facility, and a waiver that it received delaying required repayments is due to expire on May 15. It reportedly is ready to sell off MGM Grand Detroit and a Mississippi casino to raise some cash.Last week the corporation dodged a bullet by meeting a required $200 million payment on the CityCenter project, although the future of this project is clouded by its strained relationship with partner Dubai World. Dubai claims that MGM has failed to keep a lid on the cost of the multi-billion dollar development.

Over half of MGM's net revenue comes from non-gaming activities, which means that is has been hit hard by the sharp decline in convention business. The Las Vegas Tourism Bureau reports that the number of guest rooms in the city grew by 8,000 in 2008, while visitorship dropped by 11.87 percent and gross gaming revenue fell by 16.27 percent.

While a favorable report about the gaming scene in Macau and the possible casinos sell-off have helped check the long decline in the price of MGM stock, the sword of Damocles still hangs over MGM Mirage. The odds aren't all that great that it can avoid bankruptcy if the gaming malaise continues.

On the other hand, those looking for vacation deals should take a look at Vegas. You won't have to contend with crowds.

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