Shares of MGM Mirage Inc. (MGM) shot up a day after the casino giant said it no longer faced a bankruptcy concern.

As the global economic slump took the shine off the once thriving gambling industry in Las Vegas, MGM Mirage warned in March that there was "substantial doubt about its ability to continue as a going concern" due to mounting debts. The stock had slumped below $2 at the height of bankruptcy concerns.

Billionaire investor Carl Icahn has been pressuring the company to restructure its $13.5 billion debt through bankruptcy protection.

In a filing with the Securities and Exchange Commission late on Tuesday, MGM Mirage said that the $2.6 billion it raised by selling debt and equity last month will enable it to retire its short-term debt that had given rise to the going concern clause.

This would certainly bring some relief to Kirk Kerkorian, who owns a majority stake in the beleaguered company. If MGM were to file for bankruptcy, secured debtholders would get priority over shareholders.

Shares of the company were up more than 13% to $6.64 at noon on the New York Stock Exchange after reaching as much as $6.83 earlier in the session. They are, however, still far from a 52-week high of $39.50.

After MGM Mirage (MGM) gained some breathing space by amending its senior credit facility, the casino giant said it would raise $2.5 billion through stock and bond offerings in order to pay down a chunk of its debt obligations.

The company, which is battling the biggest slowdown in the history of gambling in Las Vegas, said it would privately place $1.5 billion senior secured notes in the junk bond market and offer 81.0 million common shares for gross proceeds of about $1 billion.

The modifications made with its creditors will allow MGM to permanently waive potential defaults from the term "going concern" in its financial statements for fiscal years 2008 and 2009. The company was earlier handed a deadline of June 30 to formulate a restructuring plan that would help it stay afloat in the ongoing crisis.

The sale of the two-part senior secured bonds maturing in 2014 and 2017 is expected to help restructure MGM's debt load of more than $14 billion and provide some liquidity. The move from Kirk Kerkorian's dream project comes at a time when investors seeking high returns are showing their willingness to buy riskier bonds from lower-rated firms. All three major agencies have downgraded MGM's credit ratings repeatedly in the recent past due to its mounting debt.

MGM Mirage (MGM) shares slumped at the open on Friday following reports that activist investor Carl Icahn was pressing the distressed gambling giant to restructure its $13.5 billion debt by seeking bankruptcy protection.

Late Thursday, The Wall Street Journal said Icahn and private-equity fund Oaktree Capital Management have been pursuing MGM Mirage to clean up its balance sheet as soon as possible since last month. Citing sources familiar with the matter, the paper said the two investors, who have separately amassed hundreds of millions of dollars in MGM Mirage debt in recent months, stressed bankruptcy as the best option.

Icahn's strategy endangers the majority stake billionaire investor Kirk Kerkorian owns in MGM. Kerkorian's 53% stake would amount to nothing if the company files for bankruptcy, giving secured debtholders priority over shareholders.

MGM Mirage, which has been working hard to avoid bankruptcy, has to make a new equity payment on a big Las Vegas project by Friday. Shares of the company were down nearly 13% to $5.15 in morning trade on the New York Stock Exchange.

MGM Mirage (MGM) said it may default on its debt this year if the economy does not rebound and delayed the filing of its annual report.

The casino operator owned by billionaire investor Kirk Kerkorian said it was in compliance with loan covenants under its senior credit facility as of Dec. 31 but will be forced to breach them if the recent adverse conditions in the economy in general -- and the gaming industry in particular continue.

The Las Vegas-based company has suffered over the last year as gaming revenues slumped with fewer gamblers frequenting slot machines in the wake of the global recession. Last week, MGM Mirage borrowed the remaining $842 million in its revolving credit facility and is now negotiating with senior creditors for a covenant waiver or amendment.

The company postponed filing its fourth-quarter and annual report until March 17. MGM Mirage also said its auditor would include an explanatory paragraph raising doubt about its ability to continue as a going concern in the filing. Shares of the company fell 18% to $2.14 at noon on the New York Stock Exchange.

This from Today’s Financial News:

Sometimes you have to wonder what goes through the head of some of the world’s most renowned investors. Is it possible that billionaires make emotional moves just like so many other everyday investors?

While billionaires certainly make the same mistakes you and I make. I do not think that is the case with Kirk Kerkorian.

After shelling out a billion dollars to get his hands on a 6.5% stake of Ford (NYSE:F), Kerkorian and…