Wynn exploring IPO, sources say

Tuesday, April 23, 2002 | 11:01 a.m.

Casino developer Steve Wynn is exploring whether to sell part of his gaming company to the public, possibly this summer, two industry sources said today.

One source said the deal had been proposed and was being orchestrated by Ron Kramer, Wynn's financial adviser. A Wynn Resorts spokesman could not be reached this morning.

"I think this is a creative solution by Ron Kramer, orchestrating a viable financing package for Wynn," the source said. "My sense is there's going to be interest in this deal."

Wynn's major equity investor to date has been Aruze Corp., a Japanese gaming equipment company, which invested $260 million. But Wynn Resorts will need substantially more than that to build Le Reve, which will cost more than $1.6 billion, and a separate project in the Chinese coastal city of Macau.

Funding these projects with bonds alone would be difficult, "because you're talking two years with no cash flow, and bondholders like cash flow," the source said.

And despite Wynn's previous distaste for the public stock markets, there's a second advantage to being a public company -- the soaring stock prices of gaming companies in recent months.

"Gaming stock multiples are at an all-time high, and Steve's no financial dummy," the source said. "If investors are willing to pay the highest prices ever for gaming assets, maybe it's not a bad time to go public again."