Harrah’s Entertainment Inc., the world’s largest casino company, was sued by two shareholders who say a USD 15.1 billion offer from buyout firms Apollo Management and Texas Pacific Group is too low.
Harrah’s disclosed the offer of USD 81 a share on Oct. 2. The transaction is an „apparent camouflaged management buyout,“ investors Henoch Kaiman and Joseph Weiss claim in a Delaware Chancery Court complaint filed Thursday.
Chairman Gary Loveman „expects to be part of an eventual deal,“ say the shareholders, who want the company to hold an auction. „Private equity investors are looking to capitalize on the company’s bright future while excluding stockholders from realizing similar returns.“
Harrah’s owns casinos in 13 states — including the Horseshoe Casino in Hammond — plus Spain and Slovenia, and it had sales of USD 7.11 billion last year. The company „is on the cusp of realizing substantial returns“ on land investments in Las Vegas, where it’s based, the complaint says.
Alberto Lopez, a Harrah’s spokesman, said the company doesn’t comment on pending litigation. Harrah’s said Oct. 2 that its board was reviewing the bid, which was 22 percent higher than the stock’s Sept. 29 closing price.
Steve Anreder, a spokesman for Apollo Management in New York, said the company wouldn’t comment on the lawsuit. Lisa Baker, a spokeswoman for Fort Worth, Texas-based Texas Pacific Group, wouldn’t immediately comment.