To steal a line from the American novelist Mark Twain, it seems that the imminent death of Las Vegas Sands Corp. has been much exaggerated.
LVS managed something of a coup last week in being able to raise USD2.1 billion from the sale of extra shares and warrants without the need for pre-approval by existing shareholders. This was despite the fact those same shareholders will have seen significant short-term dilution in the value of their stock.
William Weidner, the LVS President and Chief Operating Officer, told a meeting of investors on Monday that the cash will help to complete the Marina Bay Sands integrated resort in Singapore, without the need for assistance from the city-state’s government or leading local businessmen. The credit squeeze and earlier issues over delivery of construction materials means Marina Bay is likely to have a phased opening, beginning in late 2009.
It won’t be much comfort though to the several thousand construction workers laid off in Macau after LVS scaled back its development work on the Cotai Strip. (It was reported somewhat misleadingly in a strap line on CNN Asia as ’11,000 casino workers lose their jobs’).
Given the urgency of the situation, the intervention of the New York Stock Exchange in the financing exercise would have been rather like asking paramedics to get a signed patient consent form from a man who’s lying on the ground after a heart attack.
Mr Weidner suggested though in an interview this week that the media may have overreacted, regarding LVS’s underlying health and the negotiations on its funding.
“Any time you have those kinds of transparent conversations, noise happens in the system,” Mr Weidner said. “But the noise ought to all go away.”
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