MGM Mirage said on Wednesday that it had amended its senior credit facility, allowing the casino operator to offer up to $2.5 billion in stock and debt, and its shares fell 15 percent.

As part of the amendment, MGM Mirage would privately place $1.5 billion worth of senior secured notes. The company will also offer 81 million common shares, which it hopes will raise about $1 billion.

MGM Mirage, which is controlled by billionaire Kirk Kerkorian, said it would use the proceeds from the two offerings mainly to repay debt.

The senior notes will be secured by a lien on substantially all of the assets of the Bellagio Hotel and Casino and The Mirage, both in Las Vegas, the company said in a statement.

MGM Mirage, burdened with $14 billion of debt, previously gained a waiver from lenders giving it until June 30 to bring borrowings in line with financial covenants.

The company has come close to violating a loan covenant dictating the level of earnings in relation to debt.

Earlier this month, MGM Mirage posted a quarterly profit, helped by a gain from a resort sale, and said cancellations were slowing.

The company said at the time that it was continuing to seek a long-term solution to improve its financial position.

On Wednesday, MGM Mirage also said it had commenced a cash tender offer for Mandalay Resort Group's $226.3 million, 6.5 percent senior notes due July 31, and its $820.0 million, 6.0 percent senior notes due October 1.

MGM's shares have traded in a wide 52-week range -- from a high of $53.67 on May 16, 2008, to a low of $1.81 on March 6, this year.

The stock was down $1.86 at $10.54 in morning New York Stock Exchange trade.

Merrill Lynch, Deutsche Bank , J.P. Morgan , Morgan Stanley and UBS are joint bookrunners for the share offering.

Banc of America Securities , Barclays , Citigroup , RBS and Wachovia are joint bookrunners for the note offering, which will include 2014 and 2017 maturities according to IFR, a Thomson Reuters service.

(Reporting by Bijoy Koyitty in Bangalore and Deepa Seetharaman in New York; additional reporting by Dena Aubin; Editing by Maureen Bavdek and Lisa Von Ahn)

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