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LVS: MIRIAM STEPS UP (SO DOES SHELDON)

Sheldon Adelson and his wife each purchased 7.8 million shares of LVS for a total of around $45 million.  This is not chump change.  He and Miriam met with investors at an investor conference last week and by all accounts the meetings were positive.  In this space, we’re used to managements selling stock after they talk their stock up.  To his credit, they bought stock after the conference.  Bravo.

Are they throwing good money after bad?  It’s hard to believe that Sheldon would be buying that much stock if LVS was on its way to a major covenant breach and bankruptcy.  At the current price, the stock implies that bankruptcy is a realistic probability. 

The takeaway here is generally positive.  However, one note of caution is in order.  The purchase of stock diminishes the possibility of a near-term transaction announcement.  We still expect LVS to pursue the sale of the Macau malls and possibly casino assets but we can safely assume that nothing is imminent.  Nevertheless, it’s hard to find much negative in a Chairman doubling (not quite) down.