Hudson Bay keeps investing in gaming concern

Wednesday, April 7, 1999 | 10:43 a.m.

David Lesser's Hudson Bay Partners L.P. continues to accumulate preferred shares of Santa Fe Gaming Corp. stock.

A document filed with the Securities and Exchange Commission Tuesday said Hudson Bay now owns 33.2 percent of the shares, up from 31.5 percent listed in a filing last month.

The shares were acquired in a series of open market purchases from late February through Thursday, April 1. Hudson Bay has bought all of its preferred shares since last year. The purchases have driven up the preferred stock's price, from the mid-20 cent range last year to 77 cents in mid-March. Hudson Bay's April 1 purchases were at 51 cents per share.

Because Santa Fe has missed dividend payments for two straight years, company by-laws give preferred shareholders the right to elect two special directors to the company's board for the first time at this year's annual meeting. Lesser supports two outside director nominees for Santa Fe's board.

Lesser and Hudson Bay also own bonds in a bankrupt Santa Fe subsidiary, and were unsuccessful in a recent attempt to force Santa Fe itself into bankruptcy. Santa Fe is suing Lesser and Hudson Bay, accusing Lesser of a bad-faith attempt to take over the company. Hudson Bay's SEC filings say the Lesser-controlled investment firm is buying Santa Fe bonds and preferred stock for investment purposes only.