Las Vegas Sands shares plummet; doubts over future - Reuters - 7th November 2008

NEW YORK (Reuters) - Las Vegas Sands Corp shares fell more than 40 percent on Thursday after the casino operator's auditor said there are doubts about the company's ability to continue as a going concern.

Casino stocks have been punished over the past year as a gambling boom in Las Vegas came to an end and tight credit markets jeopardized growth plans.

Sands' decline is a stunning reversal for the world's most ambitious gaming company, which only last year opened the world's biggest casino in Macau. Its principal stockholder is billionaire Sheldon Adelson.

Sands shares, which have fallen from over $122 last December, were down about 38 percent at $7.24 at midday, but remain above their all-time low of $4.32 posted on October 28.

Based on current estimates, Las Vegas Sands expects it will not be in compliance with its maximum leverage ratio covenant for the quarter ending December 31, 2008 and at subsequent quarters, accounting firm PricewaterhouseCoopers LLP said in a regulatory filing on Thursday.

Noncompliance would result in defaults, which raises substantial doubt about the company's ability to continue as a going concern, the filing said.

DROP IN FORTUNE

Las Vegas Sands said it is working with a financial adviser on a capital-raising program, but that no assurances can be given the program will be successful.

The casino operator has also filed a mixed shelf registration with regulators that would allow it to sell securities.

Sagging spending power has hurt business in Las Vegas, where Sands operates the Palazzo and Venetian resorts, as well as the Sands Expo and Convention Center.

Sands said last month that Adelson, its chief executive and principal stockholder, and his family intend to participate in the capital raising.

Sands said then that Adelson and his family had completed an investment in the company of $475 million in convertible senior notes.

Last month, Forbes magazine recalculated the fortunes of some of the 400 wealthiest Americans and said Adelson has been among the billionaires hit hardest by the financial crisis, with his fortune dropping about $4 billion to around $11 billion.

(Reporting by Mark McSherry, editing by Dave Zimmerman and Andre Grenon)

(Credit: Reuters)

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