stocK Watch 63
The waiting
In between, MGM Mirage saw its In the lasts days of October, the Fed-
shares drop 69 percent, Wynn Resorts eral Reserve’s half-point cut to the fed-
decreased 59 percent and Melco Crown eral funds rate appeared to alleviate fears
slid 52 percent. about financing for the casino operator
according to Forbes and LVS was able to
Turbulent times take a short breath.
At the beginning of November, S&P
Changed days indeed for Las Vegas lowered LVS’s corporate credit rating
Sands (NYSE:LVS), whose shares reached to B from B+ on the expectation that
a peak of about US$148 a year ago. Con- its performance will continue to come
sidering just the latest news, its shares under pressure for at least the next few
went down in late October in a reaction quarters.
to rumours that the company was working Its stocks fell more than 30 percent
with an investment bank to raise capital. on the 6th of November after the group
Earlier, Sheldon Adelson, chief ex- warned that it risked defaulting on its
ecutive and principal stockholder, and debt, “raising doubts about its ability to
his wife Miriam, loaned Las Vegas continue operating as a going concern,’’
Sands US$ 475 million (MOP3.8 trillion) the Financial Times noted .
through a 6.5 percent convertible note The substitution of the company’s
due in 2013. chief financial officer and the suspen-
According to the Associated Press, sion of casino developments in Macau
the investment helped the operator of the and Pennsylvania contributed to the
Venetian and Palazzo resorts in Las Vegas turbulence in November, as well as the
and the Sands Macao and the Venetian news that LVS has secured more than
Macao, meet its liquidity requirements US$2 billion in capital-funding commit-
and avoid triggering a loan covenant. ments.
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december 2008
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