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The Newsroom - 2004 |
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Gaming stocks showing strength
Index at high point since 1998 inception
December 01, 2004 - Las Vegas Sands, owners of The
Venetian, increased its initial public offering to more than
$500 million, the company announced Monday in a filing with
the Securities and Exchange Commission.
Funds from the IPO, which the company disclosed originally in
September at $350 million, are expected to be used for
building the new Palazzo, which is under construction next to
The Venetian, as well as expanding the company's presence in
Macau. Also, Las Vegas Sands has announced agreements to build
casinos in the United Kingdom.
According to the filing, Las Vegas Sands plans to offer 23.8
million shares at an estimated price range of $20 to $22 per
share, with a payout of $524 million. The underwriters, which
are led by Goldman Sachs Group, will have the option to
purchase an additional 3.6 million shares.
The company plans to trade on the New York Stock Exchange
under the ticker LVS. Sands Chairman and Chief Executive
Sheldon Adelson, who also controls the adjacent 1.2
million-square-foot Sands Expo and Convention Center, will own
88.1 percent of the common stock after the offering, the
company said.
Venetian spokesman Ron Reese said the policy of the company
was not to make additional comments other than what is listed
in the public filings.
According to the filing, Las Vegas Sands believes, "The
concentration of luxury and themed casino-hotels and resorts
is expected to continue encouraging visitor interest in Las
Vegas as a business event and vacation destination and, as a
result, increase overall demand for hotel rooms, gaming and
entertainment."
Analysts believe the announcement of an estimated price range
signals the company is ready to begin its IPO road show for
investors.
Brian Gordon, an analyst with Applied Analysis, said Las Vegas
Sands is looking for "creative ways to raise the capital to
fund its expansion plans."
He said The Venetian has been operating successfully, which is
indicative of the company's strength.
"When you see that roughly 12 percent of the company is worth
more than $500 million, I think they're getting a pretty
reasonable stock price in this market," Gordon said.
Said Susquehanna analyst Eric Hausler, "Obviously not a lot of
the company is being put into play, but the funds will be used
for Las Vegas, Macau and the United Kingdom."
Adelson opened the 3,000-room Venetian casino on
the Strip in 1999 on the site of the demolished Sands.
With travel to Las Vegas surging, Las Vegas Sands opened
a $275 million hotel tower expansion to The Venetian
last year.
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