Anchor Gaming chairman resigning

Monday, Sept. 25, 2000 | 10:54 a.m.

SUN STAFF AND WIRE REPORTS

Anchor Gaming, a Las Vegas maker of slot machines and lottery equipment, said it will buy back $306 million in stock from Chairman Stanley Fulton and his family, after which Fulton will be replaced by Chief Executive T.J. Matthews.

Fulton founded the predecessor to Anchor in 1988 and has been its chairman since its inception. He could not immediately be reached for comment on why he is leaving the company or why he and his family are selling most of their stock in the firm.

Anchor also plans to split its shares 2-for-1, the company said in a statement. Shareholders as of Oct. 31 will receive one additional share for each share held.

The company plans to buy back from Fulton and his family 4.6 million shares, or about 39 percent of its shares outstanding, for $66.60 a share. That's down from Friday's closing price of $69.88.

Anchor will pay $240 million in cash and $66 million in promissory notes. Fulton and his relatives will own about 539,600 shares after the transaction, which is expected to close by the end of next month.

In exchange for Fulton canceling the notes, Anchor will sell him a 25 percent stake in a Massachusetts horse racing facility and all assets of its Sunland Park Racetrack & Casino in New Mexico.

Fulton has been with Anchor since 1988. His son, Michael Fulton, and daughter, Elizabeth Jones, also will give up their board seats upon completion of the stock transaction, expected by the end of March.

Anchor was advised by Wasserstein Perella & Co. and said the deal was approved by a special committee of disinterested directors. The company said it would fund the cash portion of the stock purchase through an amendment to its existing senior credit facility, led by Bank of America, and through the issuance of debt.

Anchor also said Joe Murphy, its vice president, will be named chief operating officer-gaming operations and will be added to the board of directors.

"Stan's contribution to the growth of Anchor Gaming from a small private company into an industry leader has been immeasurable," Matthews said in a statement.

The shares of Anchor rose 4.19, or 6 percent, to $74.06 in midmorning trading today. They had risen 61 percent this year.