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Strategies & Market Trends : Cents and Sensibility - Kimberly and Friends' Consortium -- Ignore unavailable to you. Want to Upgrade?

To: Doug Robinson who wrote (18196)	10/11/1999 9:25:00 AM
From: vagabond	Respond to of 108040

Remember that LVEN story from last week, about it making offer to buy "Jackpot"? The report sent LVEN shares soaring. Well, this Bloomberg article (from Friday) suggests there might be a lot LESS to the whole thing than meets-the-eye (I'm thinking of a four-letter-word, starting with "s"...)... ======================= Ailing Las Vegas Entertainment Offers to Buy Jackpot Los Angeles, Oct. 8 (Bloomberg) -- Las Vegas Entertainment Network Inc., an unprofitable company with no revenue, offered to buy Jackpot Enterprises Inc. for $95 million in cash. The unsolicited $11-a-share bid, disclosed in a Securities and Exchange Commission filing, is a 28 percent premium to Jackpot's closing price yesterday. Jackpot stock rose 1 3/16 to 9 13/16. Las Vegas Entertainment rose 1 9/16 to 5 3/16. It soared as high as 9 1/8, a 52-week high, as 1.587 million shares traded, 30 times the three-month daily average. Los Angeles-based Las Vegas Entertainment's financial condition makes it an unlikely suitor for a company that earned $4.6 million in its latest fiscal year. Las Vegas Entertainment lost $47.5 million since it was founded in 1990, including $5.28 million in the first nine months of fiscal 1999. As of July 31, it had $177,619 in the bank, with monthly expenses of $50,000 to $75,000. Current liabilities of $792,066 exceeded current assets of $197,596, according to SEC documents. The company warned on Sept. 24 that its continuing losses ''raise substantial doubt about the company's ability to continue as a going concern.'' Las Vegas Entertainment told the SEC it would finance the Jackpot acquisition with $190 million it expects to receive from an agreement to sell 12.2 million shares at $15.58 each to Fred Cruz, president of Countryland Wellness Resorts Inc. in Las Vegas. Cruz, whose company is based in his eight-room home, wasn't immediately available for comment. Financial Backing It said Cruz's commitment is backed by a $400 million guarantee from an Arizona company, U.S. Guarantee Corp. That company was dissolved on March 19 after it issued a bad check, said David Adams, an attorney with the Arizona Securities Division. U.S. Guarantee still maintains a Web site, which states that its mission is to ''administer aid on a worldwide scale to any group in need of assistance.'' Telephone messages left for Las Vegas Entertainment executives weren't returned. Jackpot said its board would study the offer. The Las Vegas- based company operates about 4,000 gambling machines in Nevada and had sales of $95.7 million in fiscal 1999. Jackpot said last month it would hire an investment banker to evaluate its alternatives. Oct/08/1999 16:21 For more stories from Bloomberg News, click here. (C) Copyright 1999 Bloomberg L.P. Any redistribution of Bloomberg content, including by framing or similar means, is expressly prohibited without the prior written consent of Bloomberg L.P. Any reference to the material must be properly attributed to Bloomberg News. The information herein was obtained from sources which Bloomberg L.P. and its suppliers believe reliable, but they do not guarantee its accuracy. Neither the information, nor any opinion expressed, constitutes a solicitation of the purchase or sale of any securities or commodities.(C) Copyright 1999 Bloomberg L.P. BLOOMBERG, Bloomberg News, Bloomberg Financial Markets, Bloomberg Television, Bloomberg News Radio are trademarks, tradenames and service marks of Bloomberg L.P.