Leisure/Hotels

Steve Wynn puts favorable house rules to test

21 Feb 2012

The gaming magnate’s feud with his longtime partner just became a casino battle royale. Wynn Resorts accused Kazuo Okada, its largest shareholder, of bribery and forcibly cashed him out at a steep discount. The pachinko king must know rules often get tilted in the house’s favor.

Steve Wynn comes up unlucky in business love, too

14 Feb 2012

The casino magnate has already divorced the same woman twice, the second time coughing up a $1 bln stake in Wynn Resorts. Now, his decade-long financial union - and close friendship - with pachinko king Kazuo Okada is also on the rocks. Even in Las Vegas, money can’t buy love.

Don’t laugh: stand-up comedy looks a bit bubbly

22 Dec 2011

Plans to float a chain of UK comedy clubs are about more than comic timing, even if the IPO market is pretty laughable at present. Stand-up has never been bigger. But consumers can be fickle, and many fans are only recent converts. Jongleurs better hope the joke doesn’t wear thin.

Latest MAC attack hints at bigger M&A trouble spot

14 Oct 2011

After crying “material adverse change,” buyout firm Cerberus is close to landing Innkeepers for less than first agreed. The broad MAC in this bankruptcy deal may not reflect market reality. But sellers still have work to do ensuring buyers know the price of trying to walk.

Private equity yellow-bellies make sorry return

23 Aug 2011

Cerberus and a partner reneged on an agreed buyout of hotelier Innkeepers, citing a material adverse change after markets burped. It may be just a wimpy negotiating ploy. But investors got burnt by similar tactics in the crisis. This is a good reminder to remain wary.

Three’s a crowd in Zynga’s ownership structure

6 Jul 2011

It's bad enough for shareholders when companies have two sets of shares, as they invite bad governance habits and valuation discounts. Now Zynga is going for a trio of voting rights, with founder Mark Pincus in a class of his own. The innovation shouldn't be copied.

Zynga brings much-needed cash crop to IPOville

5 Jul 2011

Tech firms have gone to market by the bushel with little earnings in tow. Zynga arrives with income aplenty from online games like FarmVille. Most of it was harvested from Facebook, but that risk is manageable. And Zynga's profitability is even more bountiful than first appears.

Hedge funds realize baseball is too big to fail

27 Jun 2011

JPMorgan's Highbridge is the latest to bail out a struggling team. Its $150 mln loan to the bankrupt Los Angeles Dodgers follows David Einhorn's New York Mets investment. Bad finance may be hurting the game's popularity but America's pastime still looks a good longterm bet.

HomeAway IPO too reliant on bought-in growth

27 Jun 2011

The vacation home rental listing service is the latest Web outfit seeking an outsized IPO valuation above $2 bln. The business looks solid, yet the firm has goosed expansion through M&A. Investors are hungry for growth, but they should be warier of the acquired kind.

Imagine if Groupon’s wacky accounting caught on

13 Jun 2011

The Internet coupon startup seeking a $30 bln value wants investors in its IPO to ignore silly things like marketing expenses, acquisitionrelated costs and stock compensation. If these financial standards were applied to other companies, the world would be a far richer place.

Pandora’s huge price tag misses old-school model

3 Jun 2011

The online radio group's IPO seizes on the Internet hype with a potential $1.4 bln valuation. But as cool as the service may be, its reliance on radio ads isn't too novel. Investors also should appreciate the lack of operating leverage and avoid getting swept up in the frenzy.

Lady Gaga’s monster sales are frightening indeed

2 Jun 2011

The 1.1 mln tally for Born This Way is the biggest first week for an album since 2005. But it's no turnaround for the music industry. It took a year of hype and Amazon basically gave away 40 pct. Even if concerts are now center stage of the model, big hits really aren't.

Groupon IPO another bet on profit-free sales

2 Jun 2011

The Internet coupon company's revenue trajectory looks like a moon shot started in late 2008, the firm racked up $645 mln in revenue in Q1, 15 times what it brought in a year earlier. But profit looks like a submarine voyage so far. It's another test of dotcom optimism.

Mets deal gets even a financial star starry-eyed

26 May 2011

David Einhorn, the hedge fund boss who famously shorted Lehman, is poised to buy a $200 mln stake in New York's lesser baseball team. Yet the managers of the Bernie Madoffstricken Mets share some of the bankrupt bank's flaws. Sports investments are just different.

Dollar Thrifty rivals drive too hard a bargain

9 May 2011

Hertz pulled a Uturn by returning with a hostile $2.2 bln bid to challenge the stalled Avis proposal. But when considering Dollar Thrifty's improved performance and deal synergies, the sweetened offer still looks too low. Either Avis or Hertz needs to step up with more money.

Netflix pay scheme inspires behind the scenes

9 May 2011

Blockbuster's new owner and Time Warner's CEO are the latest to be won over by the movie streaming service. But one feature of its success is less well known: the way it allows staff to tailor their compensation mix and awards options on a monthly basis. It's worth a peek.

Warner Music’s $3.3 bln sale cues up same old song

6 May 2011

Under Edgar Bronfman the company bested rivals but is still selling to Len Blavatnik for half the 2005 IPO price. The billionaire is a relative insider unlikely to bring big fresh ideas. Outsiders haven't fared any better. It sounds like another financial engineering refrain.

Renren hardly looks worth huge premium to Facebook

3 May 2011

The Chinese social network's IPO aims to fetch twice the implied valuation of its larger unlisted U.S. peer. Yet Renren's revenue growth is slowing, its audit chief just quit and user numbers deserve scrutiny. That means Facebook should be worth more or Renren less.

Warner Music sale would only be an opening act

15 Apr 2011

For a company supposedly in a dying industry, the home to Bruno Mars and Metallica has attracted a surprising number of suitors, including for the troubled recording unit. But that's mainly because the finale waits in the wings, 10 years late: combining Warner with EMI.

Expedia aims for (social) network effect

8 Apr 2011

The $6.8 bln online travel company plans to spin off its popular TripAdvisor site that allows tourists to share tips with each other. That should help it capitalize on the investing fever for online communities. But the flight and hotel booking sites left behind could suffer.