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OTay Thanks.
Why Does IHUB Let This Guy PUMP 24/7/365?
TIA:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=36026994
"I think companies will be extremely conservative with balance sheets," he said. "The focus will be less about expansion, more about consolidation."
"They've got an arsenal of weapons that they can launch to address liquidity and to some extent leverage," Lerner said.
The analyst said MGM will likely look to monetize part of its multi-tower CityCenter project on the Las Vegas Strip, which is slated to open in December.
"They could sell a hotel tower or a residential hotel tower to a hotelier," he said.
Lerner said MGM has enough liquidity to resolve 2009 through 2010 debt maturities, but "needs to quell concerns that they are going out of business."
Las Vegas Sands too has options to avoid violating debt covenants, he said.
Sands Chairman and CEO Sheldon Adelson said on Tuesday that the casino operator expects to avoid a debt default through a combination of cost cuts, the sale of two retail malls and increased business in Macau.
Lerner said other options could include the sale of other Macau assets or renegotiation with banks of debt terms.
"Covenant relief is not that big of a deal," he said. "You pay for it, but it happens in other industries all the time."
Despite the current downturn, about 14,000 new hotel rooms will open in Las Vegas between now and 2011, including projects like CityCenter, Fontainebleau Las Vegas and a new tower at the Hard Rock, Lerner estimated. Continued...
Casinos shaky, but likely to survive: analyst
Tue Mar 3, 2009 11:05pm GMT
By Deena Beasley
NEW YORK (Reuters) - Shares and bonds of many casino operators are trading as if the companies are close to bankruptcy, but most have options to improve liquidity and will pull through the current recession, Deutsche Bank analyst Bill Lerner said on Tuesday.
"I think equity will change hands," Lerner said at the Reuters Travel and Leisure Summit in New York. "The composition of the industry will be different."
Casino stocks have been punished over the past year as gambling demand has fizzled, tight credit markets have jeopardized growth plans and the Chinese government has acted to slow down the booming Macau market.
Many casino operators piled on debt when borrowing was cheap and are now struggling to avoid default.
Companies like Las Vegas Sands (LVS.N) and MGM Mirage (MGM.N), which said on Tuesday it is still assessing its financial position and liquidity needs, have come close to violating debt covenants.
To raise cash, MGM in December agreed to sell its Treasure Island casino hotel to investor Phil Ruffin for $775 million.
"I wouldn't be surprised to see more from MGM," Lerner said. "I don't think any property is out of the question."
MGM owns 10 Las Vegas Strip casino-hotels, including Bellagio, Mandalay Bay and MGM Grand, as well as casino resorts in Detroit, Biloxi, Mississippi and elsewhere. Continued...
http://uk.reuters.com/article/electionsNews/idUKTRE5227L920090303
EDIT AH Now $2.25
UPDATE: MGM Mirage: Could Violate Debt Covenants This Year
March 03, 2009: 06:48 PM ET
(Updates with after-market stock movement and comment from industry expert; adds details throughout)
By A.D. Pruitt and Brian Kalish
Of DOW JONES NEWSWIRES
NEW YORK -(Dow Jones)- MGM Mirage (MGM) warned Tuesday that it could violate its debt covenants this year and be in danger of default if economic conditions continue to erode.
The struggling casino giant said it will delay filing its annual report and that its auditor is likely to include an explanatory paragraph raising doubt about MGM's ability to continue as a going concern, according to a filing with the Securities and Exchange Commission.
MGM Mirage's shares traded down 10% to $2.35 in after-hours trading.
The news came as little surprise to Wall Street as the gambling industry has been down on its luck for some time with fewer gamblers frequenting slot machines, blackjack tables and other fare amid a deepening recession.
It's been more brutal for casino giants like MGM Mirage, Las Vegas Sands Corp. (LVS) and Wynn Resorts Ltd. (WYNN) given their big exposure to the challenged markets in Las Vegas and Macau. These companies are struggling to fill hotel rooms and restaurants, while trying to stay on track with expensive resort developments amid a crippling credit crunch.
Underscoring the malaise, MGM Mirage's stock has tanked about 80% year-to- date.
MGM Mirage said it's still in the process of assessing its financial position and liquidity needs and is currently in compliance with its financial covenants. Becoming noncompliant would constitute an event of default.
The company also started discussions with the administrative agent of its senior credit facility in order to obtain a waiver for any instances of noncompliance or an amendment to the senior credit facility to modify the covenants.
"It's pretty much the end of the line here," said Roger Gros, publisher of Global Gaming Business, a trade magazine. "At this point, it looks like there is going to be some type of Chapter 11" filing.
He said MGM should be more aggressive about asset sales in order to drum up liquidity. MGM Mirage recently agreed to sell its Treasure Island casino in Las Vegas to Kansas billionaire Phil Ruffin Sr. for $775 million.
If MGM is unable to negotiate a waiver or an amendment, a majority of the lenders under the senior credit facility could accelerate repayment of borrowings, and, under certain circumstances, cross-defaults could be triggered for its other debt instruments, according to the filing.
MGM's filing comes on the heels of stiff downgrades by all three major ratings agencies Friday after the company requested to borrow $842 million under its $ 4.5 billion credit pact.
The major credit ratings agencies have long expressed concerns about how MGM Mirage will secure all the financing it needs to complete its 76-acre $9 billion CityCenter resort in Las Vegas. The agencies have said MGM Mirage will likely see higher out-of-pocket expenses to complete financing for the resort slated to open this year.
Fitch Ratings said it believed MGM is unlikely to remain in compliance with its covenant this year, and sees drawing on the revolver as a sign the company could breach its near-term covenant.
Even if the company obtains waivers or amends the terms of the credit facility the deterioration in Las Vegas and the industry outlook suggests the capital structure may be unsustainable, Fitch said.
-By A.D. Pruitt and Brian Kalish, Dow Jones Newswires; 201-938-2269; angela.pruitt@dowjones.com
(END) Dow Jones Newswires
03-03-09 1848ET
Copyright (c) 2009 Dow Jones & Company, Inc.
Go-4 All @ .10
Price Size Exch Time
0.10 250 OBB 11:42:17
0.10 250 OBB 11:42:15
0.10 4650 OBB 11:35:10
0.10 4650 OBB 11:35:09
$$$$$$$$$
Just came home . L2
can somebody tell me please at what price the other trades have been ??
74 In Vegas, (:>) I Will Fax Or EMail You Some! OTay?
Later, The Team.
Associated Press
Fitch, S&P downgrade some MGM Mirage ratings
Associated Press, 02.27.09, 05:12 PM EST
Fitch Ratings and Standard & Poor"s Ratings Services downgraded several ratings for casino operator MGM Mirage Friday citing the weak economy"s impact on Las Vegas.
The downgrades follow an announcement from MGM Mirage that it wants to tap $842 million of its $4.5 billion senior revolving credit agreement due to capital market and economic volatility. The company said it would use the money for general corporate purposes.
Fitch downgraded the company"s issuer default rating to "CCC," or substantial risk, from "B," or highly speculative. It also downgraded the ratings for senior secured notes to "B," or highly speculative, from "BB," or speculative. Ratings for the senior unsecured credit facility and senior unsecured notes were downgraded to "B-" from "B+," both of which are highly speculative.
The ratings outlook for MGM Mirage remains negative, Fitch said. The downgrades specifically affect the company"s $7 billion credit facility, $6.5 billion of outstanding senior unsecured debt, $848 million of outstanding senior subordinated debt, and $750 million of senior secured notes.
"Even if the company obtains waivers or amends the terms of the credit facility and is able to secure funding for CityCenter, Fitch believes the deterioration of Las Vegas trends and strained forward outlook indicates that the capital structure may be unsustainable," Fitch said in a statement.
S&P downgraded the corporate credit and issue level ratings to "B-" from "B+", both of which are highly speculative
The company has yet to report its fourth-quarter results, Fitch said, or file its annual report with the Securities and Exchange Commission, which it must do by March 2 or ask for a 15-day grace period.
"Results from other Las Vegas Strip operators indicate that the reduction in demand has continued to accelerate in 2009 from weak fourth-quarter levels," Fitch said.
Fitch also noted that Las Vegas airline passenger traffic declined 15.7 percent in January, a greater decline than the 12 percent to 14 percent decline experienced from September to December in 2008.
Shares of MGM fell 95 cents, or 21.4 percent, to close at $3.50 Friday. The stock fell to $3.40 during the after-hours session.
Copyright 2008 Associated Press. All rights reserved. This material may not be published broadcast, rewritten, or redistributed
LOS ANGELES, Feb 27 (Reuters) - Casino operator MGM Mirage (MGM.N: Quote, Profile, Research) said on Friday it had drawn down the remaining $842 million of its revolving credit facility, raising fears that the Las Vegas-based company is close to violating debt restrictions.
MGM shares dropped 14.8 percent to $3.79 on the New York Stock Exchange early Friday afternoon. MGM's 7.5 pct notes due in 2016 fell to 40.5 cents on the dollar from about 45 cents on Thursday, according to MarketAxess. Its 6.625 pct notes due in 2015 fell about 7 cents to 39 cents.
"While the move maximizes options, it implies that leverage covenants are either already in breach or likely to be so in the very near future," Bank of America Merrill Lynch analyst Shaun Kelly said in a research note.
MGM, a major holding of billionaire Kirk Kerkorian's Tracinda Corp, has been hit hard by slower consumer spending and stalled credit markets, which have prevented the casino operator from finalizing funding for its massive CityCenter project on the Las Vegas Strip.
The company cited continued instability in global financial markets and the uncertain state of the global economy as motivating factors behind the drawdown.
Kelly estimated that, with the latest draw, MGM would end the first quarter with a total debt of $14.5 billion to $15 billion, depending on whether or not there were debt repurchases in the 2008 fourth quarter or earlier this year.
MGM has not yet announced when it plans to release its fourth-quarter results. (Reporting by Deena Beasley; Additional reporting by Dena Aubin in New York; Editing by Richard Chang)
LUCKY You Have All Year 2 Trade This One.
$$$$$$$$$
Posted by: LUCKYTT711 Date: Saturday, February 28, 2009 2:50:03 PM
In reply to: hang ten who wrote msg# 154 Post # of 159
That's one of the reasons I'm long and also "trading" some ... LVS never failed to make me money , so I keep going back for more ... With the weak economy, it may take a little while, but there are signs of things shaking loose ... gl..
Do You Have A Link? I Think Not.
I Have A Link 4 Wynn Short.
$$$$$$$$$
LVS huge short interest - possible squeeze coming?
H-G Not Now May-B In 2010 >>>LVS
Wynn Is Short.
Vegas Is Dead Now..........
$$$$$$$$$$$
Posted by: hang ten Date: Saturday, February 28, 2009 2:10:42 PM
In reply to: None Post # of 157
LVS huge short interest - possible squeeze coming?
OTay = ( :>)
Long But G@@D Read.
MGM MIRAGE, Inc.
Hotels: 13; Rooms: 35,948
Controlled by majority shareholder Kirk Kerkorian.
NYSE: MGM | mgmmirage.com | Hoovers profile | Wikipedia profile
By far the largest player in Las Vegas, MGM MIRAGE controls half of the Las Vegas Strip. The majority shareholder is financier Kirk Kerkorian who owns about 51.65% through his private investment firm, Tracinda Corp.
Projects
Being built:
CityCenter
A 50/50 venture (through CityCenter Holdings LLC) between MGM Mirage and Dubai World (through subsidiary Infinity World Development Corp.), holding company for the emirate of Dubai.
The country's largest private construction project. Opening in phases from 2009 will be:
ARIA, a 4,004-room, 60-story tower designed by Cesar Pelli (Pelli Clarke Pelli) will be the main hub of CityCenter.
The Harmon Hotel and Residences, a 400-room hotel (2010).
Mandarin Oriental, another 400-room hotel with 207 condos called The Residences at Mandarin Oriental.
Vdara Condo Hotel. A 50-story ebony tower with about 1,495 condos that can be rented out as hotel rooms.
Veer Towers condos. Twin 37-story towers with 670 condos.
On Hold (as of 2008):
Unnamed 40-acre Strip/Sahara project
A 50/50 venture with Kerzner International (13% owned by Dubai World), who built the Atlantis resort in the Bahamas. Situated on 40 acres on the north end of the Strip, opposite the Sahara and near the Stratosphere and Circus Circus. The project was announced in June 2007 with a 2011 opening but was put on indefinite hold in October 2008.
History
The company started in 1962 when Kirk Kerkorian -- a fellow aviator and rival of Howard Hughes -- bought his first Las Vegas land. The International hotel (today's Las Vegas Hilton) followed in 1969 and various hotels were bought and sold. The MGM MIRAGE name comes from the Metro-Goldwyn-Mayer (MGM) film studio (famous for the film Grand Hotel), which Kerkorian bought in 1969, and Mirage Resorts (Mirage, Treasure Island, Bellagio), which was acquired from Steve Wynn in 2000 for $6.4 billion.
In 2005, MGM MIRAGE bought Mandalay Resort Group (Circus Circus, Excalibur, Luxor, Mandalay Bay, Monte Carlo) for $7.3 billion. Mandalay Resort Group started life as Circus Circus Enterprises, Inc. (1974-1999). Circus Circus was built by Jay Sarno and Stanley Mallin (who had previously opened Caesars Palace) but they ran into financial trouble. Starting in 1974 and completed in 1983, Del Webb casino manager William Bennett and partner Bill Pennington took over control and ownership of Circus Circus. Their company, Circus Circus Enterprises, went public in 1983. Bennett opened Excalibur (1990) and Luxor (1993) before retiring in 1995. (Bennett then bought the Sahara for $193 million). The company opened Monte Carlo (1996, a joint venture with MGM) and Mandalay Bay (1999), then renamed itself Mandalay Bay Resort Group (1999-2005) after the more upscale property.
In August 2007, Dubai World, the holding company for the emirate of Dubai, invested about $5 billion in MGM Mirage. For that, Project CityCenter became a 50/50 venture between MGM Mirage and Dubai World (through subsidiary Infinity World Development Corp.), and Dubai World received about 9.5% equity stock of MGM Mirage.
In January 2009, MGM agreed to sell the Treasure Island Hotel and Casino (2885 rooms, opened 1993) to Phil Ruffin for $775 million (including debt).
Equity Holders of MGM MIRAGE
Kirk Kerkorian
through Tracinda Corp 53.9%
Dubai World
through Infinity World Development Corp. 9.4%
Marsico Capital Mgmt LLC 8.3%
Private Capital Mgmt Inc. 6.1%
Capital Research and Mgmt Co. 4.8%
There are about 293 mililion shares outstanding
MGM Bonds Tank On Dubai Rumors
Widely-circulated rumors that Dubai World has revoked its commitment to finance MGM Mirage's CityCenter development in Las Vegas drove MGM bonds down 10 to 15 points last week. MGM bonds maturing in five to six months fell to 84-85 last Thursday morning, from 95-96 the previous week. Bonds maturing in 2010 plunged to the low 70s from 85. The drop reflects investor fear over the impact an unfinished, unfunded CityCenter would have on MGM's balance sheet, one trader said.
Infinity World Development Corp., a wholly owned subsidiary of Dubai World, is 50% owner ...
This Is Old, Feb 15, 2008
A C/P 4 Me.
MGM MIRAGE and Infinity World (Cayman) L.P. Announce Updated Preliminary
Results of Their Joint Tender Offer
LAS VEGAS, Feb. 15 /PRNewswire-FirstCall/ -- MGM MIRAGE (NYSE: MGM) and
Infinity World (Cayman) L.P., an indirect wholly owned subsidiary of Dubai
World, announced today updated preliminary results of their joint tender
offer, which expired at 12:00 midnight, New York City time, on February 14,
2008.
Subsequent to the announcement earlier today of the preliminary results of
the joint tender offer, Mellon Investor Services LLC, the depositary for the
joint tender offer, advised MGM MIRAGE and Infinity World (Cayman) L.P. that
it had failed to include in its final report of the preliminary results of the
joint tender offer an additional 7,467,169 shares tendered through Notices of
Guaranteed Delivery.
Based on the updated preliminary count, subject to final verification and
conditional tenders, approximately 109,373,891 shares of MGM MIRAGE's common
stock were tendered, including approximately 26,693,134 shares which were
tendered through Notices of Guaranteed Delivery, resulting in an updated
estimated proration factor of approximately 13.7% instead of 14.7%. Any
shares tendered upon the condition of a minimum number of shares being
purchased in the joint tender offer will be deemed withdrawn in the event that
such condition is not satisfied as a result of proration.
The number of shares tendered and not withdrawn and the proration factor
are preliminary and are subject to verification. The actual number of shares
validly tendered and not withdrawn and the final proration factor will be
announced promptly following completion of the verification process. Promptly
after such announcement, the depositary will issue payment for the shares
validly tendered and accepted under the joint tender offer and will return all
other shares tendered.
About MGM MIRAGE
MGM MIRAGE (NYSE: MGM), one of the world's leading and most respected
development companies with significant holdings in gaming, hospitality and
entertainment, owns and operates 17 properties located in Nevada, Mississippi
and Michigan, and has 50% investments in four other properties in Nevada, New
Jersey, Illinois and Macau. MGM MIRAGE is developing major casino and
non-casino resorts, separately and with partners in Las Vegas, Atlantic City,
the People's Republic of China and Abu Dhabi, U.A.E. MGM MIRAGE supports
responsible gaming and has implemented the American Gaming Association's Code
of Conduct for Responsible Gaming at its properties. MGM MIRAGE has received
numerous awards and recognitions for its industry-leading Diversity Initiative
and its community philanthropy programs. For more information about MGM
MIRAGE, please visit the company's website at http://www.mgmmirage.com.
About Dubai World
Dubai World is a major investment holding company which wholly owns or has
substantial interest in a portfolio of businesses that includes DP World,
Jafza, Nakheel, Dubai Drydocks, Maritime City, Istithmar, Kerzner, One & Only,
Atlantis, Barney's, Island Global Yachting, Limitless, Inchcape Shipping
Services, Tejari, Technopark and Tamweel. The Dubai World Group has more than
50,000 employees in over 100 cities around the globe.
Dubai World's iconic real estate projects include the Nakheel's Palm
developments and The World. The group also has extensive real estate
investments in the US, the UK and South Africa, unique hospitality
destinations in every corner of the world, and is a leading global port
operator. In the last five years, Dubai World has developed 80,000 luxury
residential villas and apartments and approximately three million square feet
of retail space.
Forward-Looking Statement
Statements in this release which are not historical facts are "forward
looking" statements and "safe harbor statements" under the Private Securities
Litigation Reform Act of 1995 that involve risks and/or uncertainties,
including risks and/or uncertainties as described in the company's public
filings with the Securities and Exchange Commission.
SOURCE MGM MIRAGE
Investment Community, Dan D'Arrigo, EVP & Chief Financial Officer, +1-702-
693-8895; or Media, Alan M. Feldman, Senior Vice President of Public Affairs,
+1-702-650-6947, afeldman@mirage.com
Dubai World is a major investment holding company which wholly owns or has
substantial interest in a portfolio of businesses that includes DP World,
Jafza, Nakheel, Dubai Drydocks, Maritime City, Istithmar, Kerzner, One & Only,
Atlantis, Barney's, Island Global Yachting, Limitless, Inchcape Shipping
Services, Tejari, Technopark and Tamweel. The Dubai World Group has more than
50,000 employees in over 100 cities around the globe.
Dubai World's iconic real estate projects include the Nakheel's Palm
developments and The World. The group also has extensive real estate
investments in the US, the UK and South Africa, unique hospitality
destinations in every corner of the world, and is a leading global port
operator. In the last five years, Dubai World has developed 80,000 luxury
residential villas and apartments and approximately three million square feet
of retail space.
How Far Down Will This One Go?
3.50 - 21.35%
After Hours 3.30 - 5.71%
Price Size Exch Time
f 3.30 400 NLS 16:37:22
f 3.26 100 NYE 16:37:03
f 3.26 100 NLS 16:35:50
t 3.30 100 NLS 16:34:26
f 3.30 100 NYE 16:33:57
f 3.30 1365 NLS 16:33:57
t 3.495 200 NDD 16:33:28
f 3.30 135 NLS 16:33:11
t 3.50 200 NDD 16:32:53
f 3.30 100 NLS 16:32:37
f 3.30 100 NLS 16:32:33
f 3.30 100 NLS 16:32:30
f 3.30 1000 NLS 16:32:26
t 3.30 145 NLS 16:32:14
f 3.30 300 NLS 16:32:01
f 3.32 100 NLS 16:31:24
f 3.35 2000 NLS 16:31:24
f 3.36 300 NLS 16:31:24
f 3.35 300 NYE 16:31:24
f 3.37 400 NLS 16:31:24
t 3.47 300 NYE 16:13:28
t 3.47 100 NYE 16:13:28
t 3.47 400 NYE 16:13:27
t 3.47 100 NYE 16:13:27
f 3.49 200 NLS 16:08:11
f 3.49 100 NLS 16:07:27
f 3.50 248 NYE 16:06:38
f 3.50 652 NLS 16:06:37
f 3.50 100 NYE 16:06:37
f 3.48 248 NLS 16:06:37
LUCKY That Is The Way 2 Play This One.
L(.)(.)K @ The AH Trades >>
t 2.28 1000000 NDD 16:06:58
t 2.28 833400 NDD 16:06:01
t 2.4874 100 NDD 16:03:15
2.28 181300 NYE 16:02:15
We Have Bad News Every Day On The Vegas TV News & Paper.
IMO This One Goes Under 2.00 Very Soon.
Take A Look @ MGM ( :>(
Later & Luck Da Team.
Fitch, S&P Lower MGM Ratings Amid Slump In Gambling Rev
67 minutes ago - Dow Jones News
Related Companies
Symbol Last %Chg
MGM 3.50 -21.35%
As of 4:01 PM ET 2/27/09
DOW JONES NEWSWIRES
Fitch Ratings issued a three-notch downgrade to MGM Mirage's (MGM) issuer default rating, pushing the rating further into junk territory, following the company's request to borrow $842 million under its $4.5 billion credit pact.
MGM and other casino operators have struggled as gambling revenue has deteriorated on the Las Vegas Strip and are having trouble filling hotel rooms and restaurants, while trying to stay on track with expensive resort developments amid a crippling credit crunch. MGM's shares were down 18% to $3.66 in recent trading.
The ratings agency's action came after MGM earlier Friday disclosed it submitted a request to borrow the funds under its senior revolving credit pact. Fitch placed its issuer default rating at CCC, lowered its outstanding debt ratings and said its ratings outlook remains negative.
Earlier Friday, Standard & Poor's Ratings Service lowered its ratings on MGM for the second time in under a month, pushing its ratings further into junk with a two-notch cut to B- on similar concerns.
Fitch said it believes MGM is unlikely to remain in compliance with its covenant this year, and sees its drawing on the revolver as a sign the company could breach its near-term covenant. Even if the company obtains waivers or amends the terms of the credit facility, Fitch said deterioration in Las Vegas trends and the industry's poor outlook suggests the capital structure may be unsustainable.
MGM has yet to report fourth-quarter results, but the results from other Las Vegas gaming companies suggest lower results at casinos will continue in 2009 from weak fourth quarter levels. Fitch said Las Vegas Strip trends will remain poor throughout 2009, with any signs of recovery unlikely until 2010.
-By John Kell, Dow Jones Newswires; 201-938-5285; john.kell@dowjones.com
Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/nae/al?rnd=wWbOB37MDRxCRnQehplNMA%3D%3D. You can use this link on the day this article is published and the following day.
(END) Dow Jones Newswires
02-27-09 1503ET
Copyright (c) 2009 Dow Jones & Company, Inc.
I Can Read All Of Your 775 Post.
http://investorshub.advfn.com/boards/profile.asp?user=86732
Staff & Wire Reports | The outlook for 2009 in the gaming industry look bleak, with a recovery not likely until 2010, according to a survey of key casino and hospitality executives.
The survey was conducted by Globalysis Ltd., a boutique Las Vegas-based research and strategy consulting firm, which just released its 2009 Casino Executive Outlook (CEO) study. The study sampled government and industry leaders from all six continents.
When executives were asked when they believed the global economy would recover, most (53%) believed it would recover in early to mid 2010. These leaders were similarly pessimistic about the current outlook of the global gaming industry, with a majority (52%) indicating that they foresaw a "very poor" or "poor" performance for this industry in 2009.
Globalysis partner Jeff Voyles summarized the study: "These findings are intriguing, and reveal that executives are now responding dynamically to unprecedented shifts in global attitudes and reduced consumption. At the same time, there is cause for optimism, as most executives surveyed see a recovery in 2010."
Many respondents extended this negative outlook to corporate hiring and social responsibility matters. Nearly half of the executives anticipated that their organization would reduce their staff in 2009, while 63% said that they anticipated that their organization would likely commit fewer resources to corporate social responsibility programs during 2009.
Some reason for optimism, however, might be found in responses to questions asking about technology and politics. Fully 63% of respondents indicated that they foresaw growth in their organization’s technology usage in 2009, while 73% predicted growth in the global internet gaming industry during the year. Meanwhile, 46% of respondents believed that the Obama administration would have a positive effect on the U.S.-based casino gaming industry, while only 12% indicated that it would have a negative effect.
Finally, given the global diversity of this sample, the Globalysis research team thought it would be interesting to ask about their impressions of the current "gaming capital of the world." As it turns out, Las Vegas still maintains the top spot: 81% voted for Las Vegas, while only 19% voted for Macao.
2/Funny Ask Was .1279 Now .1268
Later The Team.
No Fill @ .009 ( :>(
May-B Next Week..
All Is Well & We Will See....
ASK Now .1279 V = 3,900
Form 4 Insider Sell. 2/25/09
EDIT >>> Link Will Not Work, Sorry.
http://app.quotemedia.com/quotetools/showFiling.go?name=LAS%20VEGAS%20SANDS%20CORP:%204,%20Sub-Doc%201&link=http%3A//quotemedia.10kwizard.com/filing.xml%3Frid%3D12%26ipage%3D6164662%26DSEQ%3D1%26SQDESC%3DSECTION_BODY%26doc%3D1&cp=on&type=TEXT
Roy The Hook Is In = GL2U!
2.24 @ 2.25
February 25, 2009 - 2:47 PM EST
LVS 2.20 -0.39
Las Vegas Sands Corp. to Appeal Legal Challenge to CotaiJet Ferry Operation
Company Plans to Continue Providing Ferry Service During Appeal Process
MACAO, Special Administrative Region of the People's Republic of China, Feb. 25 /PRNewswire-FirstCall/ -- Las Vegas Sands Corp. (NYSE: LVS) announced today, following a ruling by Macau's Court of Second Instance challenging the company's Cotai Strip CotaiJet (TM) ferry concession, that it plans to appeal the decision to Macau's Court of Final Appeal. The company intends to file an appeal within the next week, and expects to continue to operate its ferry service until a decision on the appeal is rendered or the matter is otherwise resolved.
Las Vegas Sands Corp. stated that both the company and the Government of Macau are parties to the recent lower court ruling, and as parties to the ruling, each has the ability to appeal the case. Upon appeal, the lower court ruling will be immediately suspended until a decision is rendered by the Macau Court of Final Appeal. The basis of the legal challenge to the granting of the ferry concession is that all concessions related to the provision of public services must be awarded through a public tender process.
Mr. Sheldon G. Adelson, chairman and CEO stated, 'We believe the Macau authorities are committed to finding a solution that, in the event the lower court ruling is not reversed, would ensure that CotaiJet ferry operations are not suspended and that the public interest is protected.'
Forward-Looking Statements
This press release contains forward-looking statements that are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve a number of risks, uncertainties or other factors beyond the company's control, which may cause material differences in actual results, performance or other expectations. These factors include, but are not limited to, general economic conditions, competition, new ventures, substantial leverage and debt service, government regulation, legalization of gaming, interest rates, future terrorist acts, insurance, gaming junket operators, risks relating to our Macao gaming concession, infrastructure in Macao and other factors detailed in the reports filed by Las Vegas Sands Corp. with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date thereof. Las Vegas Sands Corp. assumes no obligation to update such information.
About Las Vegas Sands Corp.
Las Vegas Sands Corp. (NYSE: LVS) is the leading international developer of multi-use integrated resorts.
The Las Vegas, Nevada-based company owns and operates The Venetian Resort-Hotel-Casino, The Palazzo Resort-Hotel-Casino, and the Sands Expo and Convention Center in Las Vegas and The Venetian Macao Resort-Hotel and the Sands Macao in the People's Republic of China (PRC) Special Administrative Region of Macao. The company also owns the Four Seasons Hotel Macao and is constructing two additional integrated resorts: Sands Casino Resort Bethlehem(TM) in Eastern Pennsylvania and Marina Bay Sands(TM) in Singapore.
LVS is also creating the Cotai Strip(TM), a master-planned development of resort-casino properties in Macao. At completion, the Cotai Strip will feature approximately 21,000 rooms from world-renowned hotel brands such as St. Regis, Sheraton, Shangri-La, Traders, Hilton, Conrad, Fairmont, Raffles, Holiday Inn, and InterContinental. For more information, please visit www.lasvegassands.com.
Contacts:
Investment Community: Daniel Briggs (702) 414-1221
Media: Ron Reese (702) 414-3607
SOURCE Las Vegas Sands Corp.
Source: PR Newswire (February 25, 2009 - 2:47 PM EST)
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Shares Of AIG Slump On 4Q Loss Fears
68 minutes ago - Dow Jones News
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AIG 0.39 -26.42%
As of 12:00 PM ET 2/24/09
By Lavonne Kuykendall
Of DOW JONES NEWSWIRES
CHICAGO (Dow Jones)--Reports that American International Group Inc.'s (AIG) fourth-quarter loss could reach $60 billion and the company's reported efforts to rework its government rescue package forced down the company's battered shares as investors worried about potential dilution of their own stakes.
According to the Wall Street Journal, AIG executives are seeking an overhaul of the company's $150 billion government bailout package, a move that would substantially reduce the insurer's financial burden. The Journal, as well as cable network CNBC, are reporting the insurer's fourth-quarter losses could grow to around $60 billion.
Shares of AIG dropped nearly 25%, to 40 cents, in recent trading on the concern that any government bailout will dilute shareholders even further.
"We continue to work with the Federal Reserve Bank of New York to evaluate potential new alternatives for addressing AIG's financial challenges," company spokesman Christina Pretto said late Monday afternoon. "We will provide a complete update when we report financial results in the near future."
Through the first three quarters of 2008, AIG reported a net loss of $37.6 billion, driven by skyrocketing losses in its portfolio of credit default swap contracts written on securities backed by residential mortgages, as well as growing losses on other investments.
Further losses could come on residential and commercial mortgage-backed securities it holds in its investment portfolio or from its portfolio of credit default swaps written on securities issued by other banks.
Some of AIG's business subsidiaries are likely to be feeling the pain from AIG's weakened borrowing position.
In its third quarter earnings filing with the Securities and Exchange Commission, AIG pointed to a variety of problems that could come from further credit rating downgrades, including increased collateral calls or termination payments and increased borrowing costs.
-By Lavonne Kuykendall, Dow Jones Newswires; 312-750 4141; lavonne.kuykendall@dowjones.com
Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/nae/al?rnd=IopGeH4wwr6oU0nP2llg3Q%3D%3D. You can use this link on the day this article is published and the following day.
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February 23, 2009 - 8:51 AM EST
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Gaming operators in Macao meet to discuss establishing casino guild
MACAO, Feb. 23, 2009 (Xinhua News Agency) -- Initiated by local gaming magnate Stanley Ho, the executives of the six licensed gaming operators in Macao met Monday to discuss the establishment of a new chamber of gaming companies.
This was the first time for the six gaming operators, namely SJM (Sociedade de Jogos de Macao), Galaxy Casino, Venetian Macao, Wynn Resorts (NASDAQ:WYNN) (Macau), Melco Crown (Macao), and MGM Grand Paradise, to meet voluntarily ever since local gaming sector were open to foreign investment in 2002.
The representatives of the six operators were very "cooperative" when it comes to the topic, and they all agree to establish a new chamber of gaming companies as soon as possible, said Stanley Ho who also attended the meeting personally, adding that a consensus of him being the president of the new chamber was also reached during the meeting.
The move came when global financial crisis hurt the growth of casino revenues in the Macao Special Administrative Region (SAR) of China. Las Vegas Sands (NYSE:LVS) , which owns Venetian Macao, has halted its ambitious casino project of rebuilding a Las Vegas Strip in Macao, as financing became more difficult amid the credit crunch, and many casino companies in the city also started to lay off part of their employees, starting last year.
The forming of a casino guild will strengthen the communications among the operators and between them and the SAR government, which will benefit the whole gaming sector, said Lawrence Ho, co-chairman and chief executive officer of Melco Crown. He is also the son of Stanley Ho, who owns the SJM.
Macao, the only place in China where gambling is legal, has 31 casinos so far, 19 of which are run by SJM, according to the SAR's Gaming Inspection and Coordination Bureau. Before the meeting, the SJM and Las Vegas Sands, which hold the No.1 and No. 2 positions respectively in terms of market share, have long been at odds with each other, when it comes to issues such as the VIP gambling commission rates, gaming table numbers, and ferry routes between Macao and Hong Kong.
Source: Xinhua News Agency (February 23, 2009 - 8:51 AM EST)
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Las Vegas Sands Reacts to Obama Attack
Filed in Las Vegas Sands (LVS) on Feb.19, 2009
Las Vegas Sands (LVS: 2.39 -13.09%) majority owner Sheldon Adelson is prominent among Las Vegas casino executives decrying President Obama’s warning against Vegas conventions.
Adelson told Bloomberg that Obama’s telling companies receiving government stimulus money that they “can’t go take a trip to Las Vegas or go down to the Super Bowl on the taxpayers’ dime” is hurting the city and state economy. Adelson stated, “It’s very anti-stimulus, it’s pro-recessionary, pro- unemployment.”
Adelson built Las Vegas Sands and its lead property, the Venetian Casino and Hotel, by concentrating on drawing conventions and business gatherings. He asserted that Las Vegas Sands and its competitors have the only facilities necessary to accommodate the largest gatherings.
He shrugged off the suggestion that many US citizens feel Las Vegas meetings are all hedonistic pleasure. “They’re not holding these meetings simply because they’re all boondoggles. How does an automobile company introduce their new car to thousands of dealers? How do tech companies introduce their new products and explain how they work to their dealer network?”
Geoff Freeman, a spokesman for the U.S. Travel Association, said that travel-related indutries are already forecast to lose a half-million jobs, and wondered what the industry price for being a political whipping boy would cost.
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Genting, Sands face more cost overruns at S'pore casinos
Thu Feb 19, 2009 7:21pm EST
SINGAPORE, Feb 20 (Reuters) - Genting International (GNTG.SI: Quote, Profile, Research, Stock Buzz), the overseas arm of Malaysia's Genting Bhd (GENT.KL: Quote, Profile, Research, Stock Buzz), and Las Vegas Sands LVS.N> are reportedly facing more cost overruns on their casino-resort projects in Singapore.
Genting International said late on Thursday that its Resorts World at Sentosa, which is scheduled to open early next year, will cost S$6.59 billion ($4.32 billion) compared with the previous estimate of S$6 billion.
Genting had originally projected the cost of the project at S$5.2 billion.
Las Vegas Sands Corp has also been hit by spiralling construction costs in Singapore, The Straits Times newspaper said on Friday. Sands recently revised the cost of its Marina Bay Sands casino-resort to $5.4 billion versus the previous estimate of $4.5 billion and an initial estimate of $3.2 billion.
Singapore legalised casino gaming in 2005 and said it will allow two multi-billion-dollar casinos to be built as part of an ambitious plan to double annual visitor arrivals to 17 million by 2015.
Casino operators worldwide are being stung by a squeeze in credit markets and a drop in business as the global recession spreads. (Reporting by Kevin Lim; Editing by Kim Coghill)
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Las Vegas Sands was once the envy of Wall Street. In fall 2007, with seemingly unlimited growth prospects in Macau, the most lucrative gambling market in the world, the company’s share price topped out at nearly $150.
Founder and Chief Executive Sheldon Adelson’s personal fortune rose with the company’s. On the strength of his stake in Las Vegas Sands, his net worth reached an estimated $28 billion, according to Forbes’ list of richest Americans in 2007.
Adelson, the combative son of a cabdriver, peaked at No. 3 on that list and had his eye on the top spot, held by Microsoft founder Bill Gates.
But then came the fall, a drop so fast and long that even in this era of suicidal reversals on Wall Street, Sands stands out.
The company’s market value plummeted more than 90 percent.
Adelson’s net worth shrunk by an estimated $13 billion.
To fend off Sands’ creditors, Adelson and his family injected $1 billion of their fortune into the company.
Neither Adelson nor any company executive would comment for this story, but a review of the public record and interviews with people familiar with the company’s dive provide details showing that a combination of factors were at work: bad luck, bad corporate blood, and hubris.
Certainly Adelson and the company were victims of a global financial crisis that many financial wizards failed to see.
But some industry analysts contend Sands executives played a key role in the financial decline, pushing ahead with efforts to dominate the Macau gambling market and stretching the company thin even as indicators showed credit drying up and tourism faltering.
When asked why the company didn’t raise needed cash sooner, one Sands executive, speaking two months after September’s stock market collapse, admitted to a “monumental screwup.”
That admission surfaced in a shareholder lawsuit filed in November alleging the company’s troubles weren’t solely the result of poor economic conditions or ill-timed business decisions.
“The company’s troubles mainly stem from a poorly functioning board of directors that has remained supine in the face of ... Adelson’s domination and decision to treat this public company as it if were private — in other words, his own corporate vehicle by which to aggressively develop casinos and resorts all over the world without concern for its effect on the financial solvency” of Sands, the lawsuit stated.
Years from now, what happened to Sands could be the stuff of business school case studies. Here is a first draft.
BIG RISKS, BIG REWARDS
The casino business is all about risk. Casinos are highly leveraged businesses costing hundreds of millions, even billions, of dollars. Their gambling pits use mathematical formulas that pinpoint risk down to a fraction of a percentage point.
Experienced Las Vegas operators have historically been richly rewarded for taking big risks. But even by gaming industry standards, Adelson’s resume offers something of a graduate-level course in the potential pitfalls and rewards of risk-taking.
When he created Comdex in 1979, a computer trade show that would eventually draw more than 100,000 people and make Adelson very rich, he said he chose Las Vegas as its home on a hunch that business people would like the spectacle.
“There’s a saying that goes around — Wayne Newton fills the showrooms, Frank Sinatra fills the hotels and Comdex fills the city,” Adelson told the Sun in 1995. “We’re kind of proud of that.”
When he constructed the $105 million Sands Expo & Convention Center in 1990 — the largest privately owned building of its kind in the country when it opened — critics viewed it as a foolhardy expenditure for a gambling town that had a publicly funded convention center.
With the $1.5 billion Venetian, which opened in 1999 next door to the Sands convention center, Adelson raised the stakes, betting that his flourishing trade show business could fill an upscale megaresort. He would lure conventiongoers to the Venetian with bigger rooms and more hotel amenities, charging top dollar for rooms midweek.
Competitors scoffed at the strategy, predicting failure based on the assumption that conventiongoers didn’t gamble much.
Adding to the risk, the Venetian was financed with junk bonds at interest rates as high as 14 percent, higher than other operators paid at the time.
Analysts, influenced by critics of Adelson’s unproven business plan, worried the resort wouldn’t make enough money to pay its bills.
But Adelson proved a winner. He eventually refinanced and paid down the expensive loans, making the 4,049-room Venetian, which opened a 1,000-room hotel expansion in 2003, one of the most profitable casinos of all time.
As his businesses expanded, Adelson butted heads with local forces, including the Culinary Union and the Las Vegas Convention and Visitors Authority, fueling lawsuits, pickets and controversial legislative efforts.
His two resorts, the Venetian and Palazzo, are nonunion outposts along a unionized row of casinos facing Las Vegas Boulevard. In his battle with the Culinary, Adelson has admitted that he doesn’t like being told how to do things. He also made enemies in construction circles after protracted litigation with the contractor building the Venetian.
“He doesn’t fit in the club and doesn’t kiss the rings of certain people,” said one gaming executive, referring to longtime gaming executives who form an insular group..
“Anything that rubs us the wrong way or that we don’t understand, we criticize,” the executive, who requested anonymity, said of that group.
Adelson, whose parents emigrated from Russia to escape persecution, recalls being victimized as a child in his poor Boston neighborhood for being Jewish. He began to claw his way out of poverty with a series of jobs that began with selling newspapers on street corners.
“You have to go into a business and ignore all the taboos and mores by asking, ‘why and why not?’ ” Adelson told the Latin Chamber of Commerce days before the Venetian’s debut. “Why do people do things in the business the way they do and why not some other way? Of the 50 businesses I’ve been in, I never did it the way people were doing it.”
By making piles of money on hotel rooms, Adelson helped redefine a business that had focused on gambling revenue at the expense of other amenities. His success at the Venetian was emulated by competitors such as Mandalay Resort Group, now part of MGM Mirage, which opened a 1.8-million-square-foot convention center at Mandalay Bay in 2003.
The convention business, a big part of the Strip’s growth spurt since 2001, has helped to prop up room rates in Las Vegas during traditionally slower periods, creating year-round demand.
Success seemed to make Adelson more sure of his strategies. He appeared to revel in proving the doubters wrong and showing up more cautious competitors.
His appetite for confrontation and risk seemed to grow, gaming analysts and investors say, leading to trouble for Las Vegas Sands.
AMBITIONS FOR MACAU
Macau — a semi-autonomous province of China — began welcoming Western casino operators in 2002 in an effort to rise above its roots as a seedy gambling den and broaden the region’s appeal to Asian tourists with Las Vegas-style resorts.
Las Vegas Sands was the first Western company to open a casino in Macau, in 2004.
The early bet paid off big. The company recouped its $240 million Sands Macau construction budget within a year of the opening. The casino, which has more than 600 table games yet fewer than 300 hotel rooms, primarily offered to Chinese gamblers for free, gained a foothold ahead of the resorts that followed.
The Sands Macau was just the beginning of Adelson’s ambitions in China.
A year before the casino opened, the company laid out a decade-long building plan for more than 20,000 hotel rooms and millions of square feet of retail and convention space on reclaimed land between two islands.
The first phase of the company’s Cotai Strip would include eight resorts at a cost of $10 billion.
Privately, competitors scoffed at Adelson’s idea as the product of an out-of-control ego. But he had proved them wrong before. And Wall Street, eyeing profit growth that was perhaps unprecedented in American business, was dazzled.
Las Vegas Sands initially planned to finance its Cotai Strip resorts with hotel partners. But some hotel companies didn’t want to risk capital in a market they were less familiar with and one that was based on gambling revenue, which they wouldn’t receive a cut of.
Ultimately, the risk fell to Sands. But that was good news on Wall Street, which was salivating at the prospect of millions of newly prosperous Chinese spending money in Macau.
Before the credit boom, casino operators generally lined up financing before building their properties. Sands took a riskier, more lucrative route by raising money in stages, during the development and construction process. With capital easy to come by, the company could negotiate the lowest rates and expedite construction rather than wait for each property to open and make money first before beginning the next project.
Few on Wall Street questioned this ambitious strategy, which was unprecedented in its scope and speed. The plan was perfect for the times.
“Nobody was really critical at the time because money was loose and cheap,” Deutsche Bank stock analyst Bill Lerner said.
Also, Sands had gained an impressive track record in a short time, building resorts with stellar returns at reasonable cost, Lerner said. “When they announced something, investors just assumed that it would be executed flawlessly from a financing and operating perspective,” he said.
In September 2007, Sands opened the Venetian Macau, which anchors the entrance to the Cotai Strip. At 10.5 million square feet, the resort is one of the world’s largest buildings and about twice the size of the mammoth Venetian in Las Vegas. The resort includes a 1.2-million-square-foot convention center, a 1-million-square-foot mall, a 15,000-seat arena, more than 700 table games — a world record — and more than 3,400 slot machines.
In August 2008, the company opened its second resort on the Cotai Strip — a Four Seasons hotel, accompanied by a luxury mall.
Two months later, the stock market would crash. Financing for new projects would vanish. And Sands would be left without the cash to finish what it had started.
RIFT AMONG THE BRASS
The economic downturn, which has pounded Las Vegas tourism, exacerbated Adelson’s financing problems.
The company was using cash generated by its resorts on the Las Vegas Strip to finance growth in Macau. Lower earnings here meant less money to pay bills in Macau.
Sands executives appeared confident that money would be available to finish projects that were stacking up in the pipeline.
But after investment bank Bear Stearns collapsed in March, an early victim of the subprime mortgage crisis, investors soon began asking Sands about plans for raising capital.
The company began construction on a condominium tower between the Venetian and Palazzo during 2007 and, in an August 2008 news release, said: “Addressing would-be skeptics, Adelson said quality and luxury sell in any type of financial environment and, when combined with the premium location of these residences, he believes the company has a surefire winner.”
Executives continued to counter reports they were having difficulty raising money to complete the Macau projects, telling media the company would push forward there despite the global credit crisis.
The troubles opened a rift in company management.
Sands Chief Operating Officer Bill Weidner would later call the dispute between executives advocating going full steam ahead and those favoring a more conservative approach in the face of economic troubles a “junkyard dog fight.”
In comments to a crowd of investors and analysts at the casino industry’s largest trade show in November, Weidner said the bitter disagreement led to a delay in raising money for Macau and other projects.
The failure to line up financing, he said, was a “monumental screwup.”
Sands created a special committee, including three board members, to help resolve management disputes and “in response to a loss of confidence by certain senior management members in the management of the company and our governance process.”
Finally, in November, the company announced it was pulling the plug on its unfinished Macau projects. The company would end up spending more than $1 billion to put various projects — including the Strip condos — on hold and to redesign a scaled-down resort under construction in Pennsylvania, industry analysts said.
Gaming insiders say Weidner’s public mea culpa wasn’t an admission of mistakes so much as an olive branch to concerned shareholders.
Investors had become increasingly anxious as financing needed for the company’s Macau plans failed to materialize.
But some gaming insiders say it was a risky, yet reasonable, move for Sands executives to wait for banks to loosen their purse strings.
“If I were in Sheldon’s shoes I would have done the same thing,” said one gaming executive, who declined to be named. “You really don’t know at what point the markets are going to stop vacillating. Sometimes you have to let things run their course.”
As the economy continued its decline, the Chinese government — concerned about runaway growth in Macau, money laundering in casinos and the effects of Chinese citizens gambling away their paychecks — initiated a series of visa restrictions aimed at reducing the number of visitors to Macau from mainland China.
Because Macau is the only place in China where casino gambling is legal, and given the propensity of Chinese to gamble, the restrictions were a kind of spigot that could be turned on and off, directly affecting business at Macau casinos such as the Venetian.
Buried deep in the company’s contracts with lenders were more immediate troubles: The company wasn’t making enough money, relative to its interest expenses, to stay under a maximum leverage ratio. Exceeding this ratio could trigger a default and a Chapter 11 bankruptcy filing by allowing banks to collect on the debt.
Company shares sank to less than $8 when Las Vegas Sands accountants disclosed the news in November.
Within a week, Adelson had invested another $525 million into his company on top of a $475 million cash infusion he made in September.
In a last-ditch effort to raise money, the company also issued 182 million shares of stock, more than doubling the number of outstanding shares but diluting their value. With this capital infusion, the company was able to avoid defaulting on its loans.
Aside from the company’s financial woes, the revelation of a management team at odds, for some investors, overshadowed positive steps taken to correct the problems.
“I think it’s problematic, especially in times of crisis,” said Joe Fath, a portfolio manager for T. Rowe Price Associates. “This environment is bad enough, even without a management team that can’t get along. That’s a huge headwind, in my opinion.”
FUTURE CHALLENGES
Some investors and analysts say Sands, overloaded with debt that will be tough to pay down in a troubled economy, is ultimately to blame for not raising money earlier, when banks were more willing to lend and capital was less expensive.
“A prescient CEO or CFO would have seen this coming,” Fath said of the credit crisis. “They knew what their financing needs were and they knew they were building ahead of financing.”
Lerner, the Deutsche Bank stock analyst, said the company took a wrong turn by continuing to build after the credit markets faltered.
“After it was apparent that everyone was having trouble raising capital, they continued to tap credit facilities and use liquidity to fund projects that became speculative,” he said.
Experts say this criticism is echoed by greedy investors who should have sold their shares when they were overvalued and hype about Macau was at its peak. Some shareholders have been richly rewarded by the company’s aggressive strategy, which had maximized shareholder profits until the markets collapsed.
Some experts remain starry-eyed over the prospects of the Cotai Strip despite the company’s financial difficulties. Dominating Macau, with its feeder market in mainland China, home to more than 1.3 billion people, will pay off in the long run, they say.
“Recreating the Las Vegas Strip in Asia — it’s brilliant,” said Dennis Farrell, a bond analyst with Wachovia Capital Markets. “It takes a visionary to do what Sheldon is doing there.”
But Farrell acknowledges that “going from what they have today to where they want to be is a big leap” that will also require more infrastructure in Macau, including a larger airport. That will take years, he said.
The company has emerged at the forefront of a longer-term trend as other regions consider allowing casino resorts to drive Las Vegas-style tourism. As the lead architect in Macau, Las Vegas Sands — which beat out American competitors for rights to build one of two casino resorts to open in Singapore in the coming year — is well-positioned to compete for opportunities in places such as Japan and Taiwan, where observers say casinos are simply a matter of time.
Las Vegas Sands’ admirers believe the company will emerge from its challenges and the economic downturn with a slower, though surer, gait.
The company appears to be performing respectably in desperate times, including achieving 92 percent capacity at the Venetian and 95 percent at Palazzo, at rates of more than $200 a night, in the third quarter. The Venetian Macau attracted a record 6.6 million visitors that quarter.
“Their management team is made up of very smart, seasoned gaming professionals,” Farrell said. “As long as they are wise about their growth prospects and take a more seasoned approach, I think there will be a lot of longevity with the company.”
Fath is more pessimistic, saying the company’s errors combined with a worsening economy will make survival difficult.
“I’ve been talking to CEOs and COOs who’ve been doing this for 40 years and they’ve never seen anything like this (economy),” he said.
A reflection of the company’s hard-charging chief executive, Sands is a high-risk, high-reward company that has now become an even bigger gamble for investors.
With the company struggling to keep its leverage in check in these tough times, Fath said he is unwilling to join the ranks of speculators who are gambling by investing in its stock.
“People are making a bet that (Adelson) will write another check” to shore up the company, Fath said. “That’s a tough assumption to make, as an analyst. I’m just not going to make that bet.”
A stout man who stands 5 feet, 5 inches tall, Adelson informed investors during a conference call in August that he would do whatever was needed to prop up his company.
“As all of you that know me know, I don’t equal the height of Yao Ming or LeBron James or any of the basketball players,” he said. “However, one of my closest friends says, ‘Sheldon, don’t worry about your height. You’re the tallest person I know when you stand on your wallet.’ And I’m saying right now the company will not have liquidity problems. Need I say more?”
Discussion: 21
By Steve Green
Thu, Feb 19, 2009 (3:09 p.m.)
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A third lawsuit has been filed on behalf of Las Vegas Sands Corp. shareholders against members of the company's board of directors.
Shareholder Frank Fosbre Jr. sued Sands Chairman and Chief Executive Sheldon Adelson and the other directors in Clark County District Court Feb. 6. The suit levels allegations of mismanagement and violation of fiduciary duty, similar to claims asserted in earlier suits filed in November and January in the same court.
The shareholder lawsuits were prompted by the steep drop in the value of Las Vegas Sands stock, from about $125 per share in November 2007 to about $2.75 on Thursday.
Las Vegas Sands does not comment on pending litigation, but its attorneys are fighting the earlier lawsuits.
Sands attorneys have said in court papers that the plaintiffs have failed to come up with specific allegations of misconduct or fraud, and that the Sands directors acted appropriately to deal with turmoil in the financial markets and the slowdown that hit the gaming industry last year.
The latest suit was filed for Fosbre by attorney Margaret Stanish of the Las Vegas firm Wright Stanish & Winkler; along with attorneys for the Wilmington, Del., firm Rigrodsky & Long; and Pittsburgh lawyer Alfred Yates Jr.
The three pending suits are "derivative’’ actions that aim to have the company, through its shareholders, essentially sue its own directors for damages the company may have sustained.
"Adelson has capitalized upon the economic downturn and faltering financial condition of the company by making additional substantial investments in Las Vegas Sands that have continued to dilute the common shareholders’ interests, without their input or consent, while cementing his majority stake in the company,’’ the latest suit alleges. "Adelson, together with other members of the board who are beholden to him, have mismanaged the company and damaged its prospects by spreading the company too thin over numerous projects that, for one reason or another, were impossible to complete under the conditions then-existing.’’
For the fourth quarter ending Dec. 31, Las Vegas Sands reported revenue rose 4.3 percent to $1.09 billion and that it lost $111.3 million or 27 cents per share vs. a profit in the 2007 quarter of $39.9 million or 11 cents.
Counting accumulated but unpaid preferred stock expenses, the loss in the 2008 quarter was $136.5 million.
In its Feb. 11 earnings report, Las Vegas Sands said its massive Venetian and Palazzo resorts on the Las Vegas Strip with their combined 7,100 suites generated solid cash flow and room occupancy of 93.7 percent in the quarter — a strong percentage considering the weak economy.
Adelson personally pumped additional capital into the company last year to improve its liquidity and its ability to finance developments.
He said in the earnings report that development continued to progress on projects in Singapore (a $5 billion resort complex opening in less than one year) and in Pennsylvania — a casino and entertainment complex that is estimated to cost $744 million with 3,000 slot machines. It’s 70 miles from Manhattan and is due to open in the second quarter of this year.
"We look forward to bringing these two new properties online, and we expect each to significantly increase our cash flows,” he said in the report. Adelson added in the report: “We remain confident that the revised business plan we introduced in November provides the flexibility to manage through the current operating conditions in Las Vegas and Macau while preserving the value of our important developments in Singapore and Bethlehem, Pa. While developments beyond Marina Bay Sands in Singapore and Sands Bethlehem in Bethlehem, Pa., are suspended until both the operating and financing environments improve, the remainder of our plan, including the sale of non-core assets, remains consistent with my original vision for the company.”
Steve Green can be reached at 990-7714 or steve.green@hbcpub.com.