Harrah's folds on IPO and puts spotlight on PE - Casino

LOS ANGELES/NEW YORK (Reuters) - Casino company Harrah's Entertainment Inc folded on a planned $500 million initial public offering on Friday, raising questions about the the fate of other private equity-backed companies waiting to list in the United States.
The official end to Harrah's bid to become public comes as private equity firms are looking to exit portfolio companies bought at the height of the buyout boom of 2005 to 2007.
Private equity-backed hospital operator HCA Inc, U.S. retailer Toys R Us and Nielsen Holdings, whose viewership ratings often determine the fate of TV shows have all filed with U.S. regulators to list as publicly-traded companies in the United States.
The market for new issues in the United States is bustling -- on Thursday, one-time blue-chip General Motors Co (GM.N) made a triumphant return to Wall Street with a $20.1 billion offering, the biggest in U.S. history -- but investors have historically been more critical of private equity-backed companies, which typically have higher levels of debt.
Harrah's stood out for its heavy leverage, analysts said. The company's net tangible book value before the IPO was a negative 27.74 cents, said David Menlow, president of IPOfinancial.com, an independent research firm.
"The debt structure of the company was a little too much for investors to handle," he said.
On Thursday, sources familiar with the matter told Reuters the planned listing of about 9.3 percent of the world's largest casino operator by revenue was being delayed due to concerns that the price range -- $15 to $17 a share -- was too high.
Harrah's, in a statement Friday announcing the IPO had been scrapped, cited difficult market conditions. Analysts noted a chillier reception to private equity-backed offerings.
INDUSTRY HIT HARD
The economic downturn has hit the casino industry hard, with many companies having trouble keeping up with high debt loads. Like many of its peers, Harrah's has been restructuring its debt; earlier this year it issued new notes to pay off debt that was maturing this year and in 2011.
Harrah's, controlled by Apollo APOLO.UL and TPG Capital TPG.UL, filed for the IPO in August.
In recent months, the IPO market has been less than hospitable to private equity-backed debuts. For example, Dutch chipmaker NXP Semiconductors NV (NXPI.O), which was backed by private equity firms including KKR and Bain and debuted in August, is currently trading at $12.90, 7.9 percent below its IPO price.
Apollo and TPG bought Harrah's in a $31 billion leveraged buyout in early 2008, just as the global financial crisis erupted.
Harrah's, which is changing its name to Caesars Entertainment Corp, has since seen its financial position erode. It posted a net loss of $165 million in the third quarter.
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UPDATE 1-Wal-Mart, Casino advance in Matahari unit sale-sources - Casino

* Carlyle fails to reach next round of bidding - sources
* Second-round bids due in December
(Adds details, background)
By Denny Thomas and Janeman Latul
HONG KONG/JAKARTA, Nov 17 (Reuters) - Wal-Mart Stores Inc
(WMT.N), Casino Guichard-Perrachon SA (CASP.PA) and South Korea's
Lotte Shopping Co Ltd (023530.KS) have advanced to the next round
of bidding for Indonesian retailer Matahari Putra Prima PT's
(MPPA.JK) $1 billion sale of its hypermarket business, sources
with direct knowledge of the matter told Reuters.
The auction comes on the heels of Carrefour SA's (CARR.PA)
sale of its outlets in Thailand, which brought the French
retailer a higher-than-expected $1.2 billion including debt.

Matahari's sale had drawn interest from private equity group
Carlyle Group [CYL.UL], but sources said the buyout group did not
make it to the second round. South Korea's Shinsegae Co Ltd
(004170.KS) had also expressed interest, but it was not clear
whether it was still in the running.
International retailers are jockeying for position in
emerging markets as they look for sources of growth outside
maturing U.S. and western European markets, although the cost of
competing is often too much to justify widespread expansion.
Matahari is selling Hypermart, Indonesia's second-biggest
hypermarket chain after PT Carrefour Indonesia, to focus on its
core healthcare and property assets.
Shortlisted parties had been asked to submit next-round bids
next month, a source said.
All companies mentioned in this report declined to comment.
Sources were not authorised to speak to media about the
auction as the sale process is confidential.
The sale is a seen as good opportunity to raise exposure in
Indonesia's retail sector, as a healthy economy, forecast to grow
6.0-6.2 percent this year, and a booming stock market lift
consumption in Southeast Asia's biggest economy.
It also comes just a few months after Matahari agreed to sell
a 90.76 percent stake in retail unit Matahari Department Store to
a joint venture with private equity group CVC Partners [CVC.UL]
for $770 million.
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Casino to buy Carrefour's Thai assets for $1.2 billion - Casino

PARIS (Reuters) - French retailer Casino (CASP.PA) is buying the Thai stores of rival Carrefour for 868 million euros ($1.2 billion), including debt, to step up the challenge to Britain's Tesco in the fast-growing southeast Asian country.
Casino said on Monday the 42-store acquisition would help Big C Supercenter (BIGC.BK), in which Casino owns a 63 percent stake, to become co-market leader in Thailand, with an estimated turnover of about 2.4 billion euros for 2010.
International retailers are jockeying for position in emerging markets as they look for sources of growth outside maturing U.S. and western European markets, though the cost of competing is often too much to justify widespread expansion.
Carrefour, which has exited eight countries over the past seven years, was the fifth-biggest operator in Thailand and said its growth prospects there did not fit in with its goal of focusing on countries where it can have a leading position.
Bernstein analyst Chris Hogbin said the price, at about 1.2 times net sales, appeared a little high, although that would depend on the value of the real estate assets being acquired.
Casino chief financial officer Antoine Giscard D'Estaing told analysts the price of the deal was consistent with equivalent transactions in the region.
GOING FOR GROWTH
Hogbin also said the price on Casino's deal suggested Tesco's (TSCO.L) international businesses were not being valued highly enough by analysts.
"I think it looks an OK deal for Casino," he said.
"Tesco have shown good capital discipline by walking away," he added, after sources close to the matter said the British group had also been among the bidders for the stores.
Carrefour (CARR.PA), the world's No.2 retailer after U.S. group Wal-Mart (WMT.N), has been looking to sell its shops in Malaysia, Singapore and Thailand to focus on markets where it holds leading positions.
A source with knowledge of the matter said a deal for the Malaysia and Singapore stores was two or three weeks away.
People close to the matter have said bidders for these stores include Singapore's Dairy Farm (DAIR.SI), which is backed by Jardine Matheson Holdings Ltd (JARD.SI), Tesco, Japan's Aeon (8267.T) and Malaysian private equity fund Navis Capital.
Casino, France's No.5 food retailer which has businesses in Latin America and Asia, is also in the midst of selling 1 billion euros of non-core assets to cut its debts.
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Wynn meets 3rd-quarter estimates, sets $8 dividend - Casino

LOS ANGELES (Reuters) - Casino operator Wynn Resorts Ltd's (WYNN.O) quarterly profit met Wall Street estimates as revenue in Macau rose 50 percent and it made money on nightclubs in Las Vegas.
The company also said it would pay a cash dividend of $8 per share on December 7. Its shares, which have nearly doubled so far this year, fell about 1.8 percent.
"I think there was a lot of talk in the market that the special dividend was coming," said Hudson Securities analyst Robert LaFleur. "Folks maybe thought it would be higher."
Gambling revenue has soared this year in Macau, the only place in China where gambling is legal, while the Las Vegas Strip has grappled with lackluster demand and a glut of new hotel rooms and casinos.
"I believe we've seen the bottom in Las Vegas," Chief Executive Officer Steve Wynn said on a conference call. "I don't know when it's going to get better, but I don't think it's going to get worse."
He also said October, which includes China's Golden Week holiday, was Wynn's best month ever in Macau. "We made over $90 million," Wynn said.
The company, which operates two casino-resorts in Macau and two in Las Vegas, reported a third-quarter net loss of $33.5 million, or 27 cents per share, compared with net income of $34.2 million, or 28 cents per share, a year earlier.
Excluding items such as a $64.2 million charge for early repayment of debt, Wynn earned 39 cents a share, matching the average analyst estimate, according to Thomson Reuters I/B/E/S.
"The results were solid," LaFleur said. "Vegas was a bit stronger than we were looking for on the strength of their nightclubs, of all things."
Net revenue rose 29 percent to $1 billion. Analysts had expected $990.8 million.
Wynn's revenue in Las Vegas rose 3 percent, while adjusted property earnings rose 9.3 percent due mainly to higher non-gambling revenue.
Property earnings in Macau rose 54.5 percent.
"The slow, gradual improvement that we expected in Vegas is playing out," said Morningstar analyst Michelle Chang. "And growth in Macau is exceeding our expectations."
Wynn said the company is close to completing design work on a third Macau resort, which he said could begin construction next year and be up and running by 2015. He said the project would likely have a budget between $2 billion and $3 billion.
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UPDATE 1-Boyd Gaming quarterly profit falls 11 pct - Casino

* To not exercise option to buy MGM's Borgata interest
* Adj EPS $0.02 vs est $0.05
* Rev falls 4 pct to $595.4 mln vs est $589 mln
Oct 25 (Reuters) - Casino operator Boyd Gaming Corp (BYD.N)
posted an 11 percent drop in its quarterly profit amid a
continued weakness in consumer spending, especially at its Las
Vegas properties.
Separately, Boyd also said it will not exercise its right
to match the offer MGM Resorts International (MGM.N) got for
its non-controlling 50 percent interest in their joint-venture
Borgata resort in Atlantic City, New Jersey.
Earlier this month, casino operator MGM Resorts said it
received an offer for its 50 percent stake in the Borgata
casino hotel. It valued the offer at just over $250 million.

Boyd reported third-quarter net income of $5.6 million, or
6 cents per share, down from $6.3 million, or 7 cents per
share, a year earlier.
Excluding special items, the profit was 2 cents a share,
compared with the average analyst estimate of 5 cents a share,
according to Thomson Reuters I/B/E/S.
Net revenue at Boyd, which runs Las Vegas properties that
cater mainly to local residents rather than tourists, fell 4
percent to $595.4 million. Analysts had expected revenue of
$589.0 million.
The company owns and operates 16 casinos in six states,
including a 50-percent stake in Borgata.
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Wynn Resorts files to sell more shares - Casino

NEW YORK Oct 22 (Reuters) - Casino operator Wynn Resorts
Ltd (WYNN.O) filed with U.S. regulators to sell additional
shares, capitalizing on a stock price that has more than
doubled in just under a year.
Wynn, which operates casinos in Las Vegas and Macau, filed
a shelf registration and prospectus with the U.S. Securities
and Exchange Commission on Friday, allowing it to sell an
undisclosed number of shares at its discretion in one or more
offerings.
Shares in Wynn, which was founded by billionaire Steve
Wynn, closed at $104.42 on Friday, more than double their price
on Nov. 2, 2009, when they hit $51.73.
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UPDATE 2-MGM Resorts, Tracinda sell shares, price falls - Casino

* Offering priced at $12.65 per share
* MGM could raise close to $600 million
* Shares down 11.1 percent
(Adds stock downgrade, updates share price)
LOS ANGELES, Oct 13 (Reuters) - MGM Resorts International
(MGM.N) shares fell more than 11 percent on Wednesday as both
the largest casino operator on the Las Vegas Strip and its
biggest shareholder sell stock in the company.
MGM and Tracinda Corp, the investment vehicle of
billionaire Kirk Kerkorian, said late on Tuesday they would
sell up to 47 million and 32 million shares, respectively. The
offer price was set at $12.65 -- 7 percent below Tuesday's
close.
The new shares could raise close to $600 million for MGM --
which is focused on paying down $12.9 billion in debt -- but
will also dilute the holdings of current shareholders by around
10 percent.
The sale will also cut Tracinda's stake to about 30 percent
from the current 37 percent. Kerkorian once owned more than
half of MGM, but the holdings fell after a May 2009 stock
offering.
"This was unexpected, timing is curious, and reason(s)
unclear," Deutsche Bank analyst Chris Woronka said in a
research note, referring to the Tracinda sale. "MGM's offering
should bolster liquidity, but we believe some investors would
prefer to see a $1.5 to $2 billion-plus deal that more fully
addresses debt maturities through 2013."
MGM also reported on Wednesday that preliminary
third-quarter results were lackluster, but largely in line with
Wall Street expectations.
Soleil Securities downgraded MGM to "hold" from "buy,"
citing operating results that do not support the notion of an
accelerating recovery on the Las Vegas Strip, where yet another
new resort, the Cosmopolitan, is slated to open in December.
The casino industry has been hit hard by the recession and
global financial crisis, which led to a sharp drop in gambling
revenue and hotel room rates.
Investors in MGM, and other Vegas casino operators
including Wynn Resorts Ltd (WYNN.O) and Las Vegas Sands Corp
(LVS.N), were buoyed by Nevada's report last week that Strip
casinos won 21 percent more money in August than a year
earlier.
But MGM's write-offs for the quarter -- another $182
million for impairment to the CityCenter, the $8.5 billion
project that opened on the Las Vegas Strip in December, and $46
million for CityCenter condominiums -- were worse than
expected, according to Janet Brashear at Sanford Bernstein.
"Continued write-offs make the financial picture more
uncertain, especially as it relates to CityCenter liability;
however, the pending Borgata sales represents progress in
resolving loose ends," she said in a research note.
MGM said it found a buyer for its 50 percent stake in the
Borgata resort in Atlantic City, New Jersey, at a price that
would generate around $250 million.
MGM has been looking to sell its stake after New Jersey
regulators questioned the suitability of Pansy Ho, the
company's joint venture partner in China's Macau.
Barclays Capital, the investment banking subsidiary of
Barclays Plc (BARC.L), is the sole underwriter for MGM's stock
offering.
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Problem gamblers may recover without quitting - Casino

NEW YORK (Reuters Health) - Pathological gamblers may often be able to recover from their destructive habits without giving up gambling altogether, a new study suggests.
Researchers found that among nearly 4,800 Australian adults they surveyed, the 44 men and women who appeared to be recovering pathological gamblers had largely beat their problems without completely giving up the habit.
Ninety percent were still sometimes playing the lottery, hitting the casino or betting on sports -- despite no longer screening positive for problem gambling.
The findings, reported in the journal Addiction, are in line with what has been seen in the treatment of alcohol abuse. That is, some people in recovery can successfully cut back on drinking, rather than abstaining completely. This approach is sometimes referred to as "harm reduction."
And the results suggest that problem gamblers, too, can recover even if they do not quit altogether, lead researcher Dr. Wendy S. Slutske, of the University of Missouri in Columbia, told Reuters Health by email.
Traditionally, abstinence has been the cornerstone of treatment for pathological gambling, being strongly espoused, for example, by the support group Gamblers Anonymous. But recent research has suggested that therapy aimed at "controlled gambling" can be effective.
This is important, Slutske's team notes in the report, because if controlled gambling, rather than complete abstinence, is a treatment goal, it's possible that more pathological gamblers will seek help.
The current findings are based on phone interviews with 4,764 Australian twins who were part of a national registry used for health-related research. All completed a standard questionnaire that screens people for lifetime and more-recent gambling problems.
Some signs of pathological gambling include a preoccupation with gambling, feeling the need to take increasingly bigger risks, taking time from work or family life to gamble, and hiding the habit from others.
In this study, 104 participants, or about 2 percent, screened positive for a lifetime history of pathological gambling. Of those men and women, 28 screened positive for the problem in the past year, while 32 met only some of the criteria for pathological gambling in the past year, and were considered problem gamblers.
Another 44 men and women did not report any symptoms in the past year; they were considered the "recovery" group.
Of that recovery group, 90 percent said they still gambled at times -- though considerably less often than their counterparts who did report symptoms in the past year. For example, people in the recovery group gambled on an average of 54 days in the past year, versus 176 days among those who screened positive for pathological gambling in the past year.
The study has its limitations, including the fact that it assessed participants at one time point. A study that follows people over time, Slutske and her colleagues note, could help uncover the factors that allow some gamblers to recover "in the absence of abstinence." It could also show whether their recoveries last for the long haul.
"I don't think that we know yet how people (in recovery) are able to continue to gamble without problems," Slutske said, "and more research might be needed to answer this question."
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Singapore Stocks-Flat at midday on Wall St;seen near fair value - Casino

* Index flat; near-term support seen at 3,043 pts
* Genting Singapore and Genting HK fall on profit-taking
By Eveline Danubrata
SINGAPORE, Sept 28 (Reuters) - Singapore shares were flat
at midday after Wall Street slipped overnight, prompting local
investors to take a break from a four-week rally, and are seen
range-bound in the afternoon, traders said.
By the lunch break, the Straits Times Index (STI) .FTSTI
inched 0.01 percent or 0.25 points higher to 3,113.71.
"I think we are taking the cue from Wall Street. We are
also already quite close to 3,200 and a lot of us see it as a
fundamental fair value for the STI," said Carey Wong, an
analyst at OCBC Investment Research.
"We do see more profit-taking pressures, especially if
Europe opens on the soft side," Wong said, adding that if the
STI falls below the 3,100 level, support may come in at 3,043.
Shares of casino operators Genting Singapore (GENS.SI) and
Genting Hong Kong (GENH.SI) were down on profit-taking and
after a brokerage said the current valuation for Genting Hong
Kong looks expensive.
At midday, shares of Genting Singapore were down 3 percent
at S$1.96. Nearly 76 million shares had changed hands.
Genting Hong Kong shares lost 5.3 percent to trade at
S$0.45 on a volume of 66 million shares.
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UPDATE 2-Online gaming company GVC positive on H2 trading - Casino

* Q3 average net gaming revenue up 17 pct
* H1 pretax profit 1.5 mln euros vs 8.2 mln euros last yr
* Shares rise 6 pct
(Recasts; adds analyst comments, details)
By Aditi Samajpati
BANGALORE, Sept 28 (Reuters) - European online-gaming firm
GVC Holdings (GVC.L) said trading improved at the end of the
summer holidays in the third quarter and it expected the trend
to continue through the next two months.
Total average net gaming revenue for July 1 to Sept. 26 was
up 17 percent at 151.1 million euros, said the company, which
operates three business segments -- casino, poker and sports
betting.
"We are expecting a much stronger fourth quarter in
particular, as generally gaming companies do better in the
winters because people stay in as opposed to go out and do
other things," analyst Robert Sanders at Arbuthnot Securities
said.
GVC shares, which have lost more than half of their value
over the past one year, rose 6 percent to 103.5 pence at 1152
GMT on Tuesday on the London Stock Exchange.
The firm said it expected Betboo, its South American online
sports and gaming business that it bought last year, to be
profitable within 18 months.
GVC's January-June pretax profit fell to 1.5 million euros
($2.0 million) from 8.2 million euros a year ago, with Betboo
posting a pretax loss of 1.5 million euros.
Net gaming revenue rose 8 percent to 28.1 million euros.
The Isle of Man-based company, which competes with Sportech
(ROD.L) and Sportingbet (SBT.L), declared an interim dividend
of 10 euro cents a share.
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Nevada eyes big political gamble - Casino

LAS VEGAS (Reuters) - Like many Nevadans, hairdresser Helen Elgas is trying to decide between the devil she knows and the devil she doesn't, and the future of Senate Majority Leader Harry Reid, hangs in the balance.
Sitting in the shade of a strip mall on West Sahara Avenue, miles from the casino towers that symbolize Las Vegas, Elgas is not happy with Reid. But she isn't sure she can bring herself to vote for his challenger, former state assemblywoman Sharron Angle, either.
"I think Harry Reid should be taken out. I'm not sure Sharron Angle could do any better," said Elgas, 47, a registered Republican.
"He's not helping any more - he's one of the good old boys," said Elgas, who like many Americans is fed up with the political establishment as the economy falters.
"She's a dingbat," Elgas added.
A few years ago, Las Vegas laughed at the idea of a downturn in Sin City, and the Strip boomed as economic cracks appeared nationwide. But when Las Vegas fell, it fell hard.
High rollers disappeared, construction cranes ground to a halt, and the state of 2.64 million set new records -- for the highest unemployment and foreclosure rates in the nation.
Enter Sharron Angle, founder and former teacher of a one-room K-12 Christian school turned politician, who has dumbfounded much of the state with her hard-line positions on small government.
A favorite with conservative "Tea Party" activists, Angle was only 2 percentage points behind Reid in a Reuters/Ipsos poll released on Tuesday.
Forty-six percent of likely voters in Nevada said they would vote for Reid if the election were today, while 44 percent chose Angle. The margin of error for likely voters in the poll was 4.6 percentage points, making Reid's lead even more tenuous.
Reid, running for a fifth term, is a staple of politics in Nevada. But people have been moving into the state so quickly that many voters have no idea what he has done for Nevada.
The state's population has nearly tripled since he was first elected to the Senate in 1986. Meanwhile, the median home price in Las Vegas is less than half its 2006 peak, leaving builders unable to compete with the glut of foreclosures.
Fighting for his political life, Reid is using negative ads starring Angle herself. In one, Angle says she would not have voted to extend unemployment insurance and adds "we really have spoiled our citizenry."
In another, reporters say she proposed phasing out the Social Security retirement system, although she has also said she wants to pay the amounts already promised in benefits.
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Casino cash may inject $1.5 bln into Singapore annually-DBS - Casino

SINGAPORE Aug 26 (Reuters) - Revenues from two new
casino-resorts could contribute as much as S$2 billion ($1.47
billion) annually to Singapore's economy, which is expected by
the government to grow by up to 15 percent this year, DBS Bank
said on Thursday.
The two resorts have already contributed S$470 million or
0.3 percentage points to gross domestic product (GDP), which
grew 17.9 percent in the first half of 2010 from a year
earlier, DBS economist Irvin Seah wrote in a report.
"If the GDP contributions by the integrated resorts
continue to rise at the same pace going forward, we can expect
full-year GDP contributions of about S$2 billion from these
projects," Seah said in the note.
That would translate into adding 0.7 percentage points to
GDP for the whole of 2010, he said.
Singapore is counting on the two resorts opened earlier
this year by Malaysia's Genting Bhd (GENT.KL) and Las Vegas
Sands (LVS.N) to help fuel tourism and economic growth. It
hopes to double visitor arrivals to 17 million by 2015.
In July alone, at least 1 million people visited Singapore,
the highest number the city-state ever saw in a month, after
seven consecutive months of record monthly visitor arrivals.
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