Las Vegas Sands says it's ready for future

(AP:LAS VEGAS) Worries about whether Las Vegas Sands Corp. would fold have been eased with the raising of $2.1 billion in new capital, but the casino company's president said Monday that it should have raised the money sooner.

"We had to do what we had to do to put ourselves in a position to survive," said William Weidner, the company's president and chief operating officer, told a forum for investors late Monday.

In a filing with the Securities and Exchange Commission Monday, the company said its independent accountants, PricewaterhouseCoopers LLP, improved their view of Sands to "going concern," based on Sands' sale of common stock and preferred stock with warrants.

The company has been struggling with its balance sheet since at least September, when CEO and founder Sheldon Adelson and his wife, Miriam Adelson, invested $475 million in the company to keep it in compliance with debt obligations.

When asked why Sands didn't raise the needed capital sooner, Weidner said: "It was a matter of robust debate within the organization. There are several of us who have very strong opinions.... It was pretty much a monumental screw-up."

Las Vegas Sands revealed in-house conflicts last week in an SEC filing where it said its board created a committee to evaluate the company's decision-making and resolve disputes between Adelson and other senior managers.

Last week's filing said the committee is to address "a loss of confidence" by managers in how the company is being run.

"I think you can think of it as a junkyard dog fight," Weidner said.

But he said the infighting was similar to what happens at other companies.

"The board wanted to have more involvement in the process and we welcomed that," Weidner said. "We could use more financial brainpower in the process as well."

Las Vegas Sands also said it reissued 2007 financials and now feels it has enough liquidity and capital resources to fund ongoing operations and fulfill its new development plans.

Friday, Las Vegas Sands said it sold 200 million common shares for $5.50 apiece for $1.1 billion, which included 18.2 million shares purchased by the underwriters. The company also sold 5.2 million units consisting of one share of preferred stock plus a warrant to buy stock at $6 a share. The units sold for $100 each.

The Adelsons purchased roughly 5.25 million shares of preferred stock and warrants at the same terms as the public offering. The warrants included in the public offering and sale to the Adelsons could raise an additional $1.04 billion. They also converted the $475 million in notes they purchased last month into 86.4 million common shares at a conversion price of $5.50 apiece.

Las Vegas Sands did not seek shareholder approval for its financing plan, claiming an exception in New York Stock Exchange rules, even though it more than doubles the number of outstanding shares and significantly dilutes shareholder value.

The company warned that any delay caused by getting shareholder approval "would seriously jeopardize the ability to complete the offerings as well as the financial viability of the company."

Las Vegas Sands said it planned to use proceeds to help fund construction and development projects, which it said would be significantly slowed down. Last week, the company said it would suspend construction at its $600 million St. Regis condominium tower in Las Vegas and two sites on the Cotai Strip in Macau.

Weidner said Monday that the company was planning to cut its costs by $100 million or more to compensate for declining revenues in Las Vegas.

Delaying construction is not uncommon these days, as several other casino operators have scaled back or abandoned development plans due to economic and credit conditions. Boyd Gaming Corp. recently postponed work on its $4.8 billion Echelon resort in Las Vegas, while MGM Mirage's default rating was downgraded by Fitch Ratings partly due to the company's difficulty paying for the $9.2 billion CityCenter complex in Las Vegas.

Shares in Las Vegas Sands ended trading at $6.35 Monday, down 18 cents, or 2.8 percent.

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Las Vegas Sands Corp.: http://www.lasvegassands.com

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