UNITE HERE has sent a letter to Deutsche Bank (NYSE: DB) to urge the bank to dispose of its non-core casino asset through the Station Casinos (Red Rock Resorts) IPO in order to boost its capital position and investor confidence. The letter can be viewed here. “Investors might be surprised to learn that Deutsche Bank is not selling off its Las Vegas casino stake even when the Station Casinos IPO goes forward,” said Ken Liu, a UNITE HERE researcher. “Instead of buying out the bank, the casino company will use the IPO to pay its founding family and management $460 million. The bank should demand a better deal from Station Casinos.” On January 28, Deutsche Bank co-CEO John Cryan announced that the Station Casinos IPO has been postponed, but the bank is “intent on proceeding there with an IPO.” However, as currently structured, Station Casinos intends to raise $450 million through an IPO and then pay $460 million to internalize management. In short, Station Casinos is doing the IPO to fund a $460-million insider deal and not to buy out Deutsche Bank (or to fund growth or pay down its $2.2 billion of long-term debt). Deutsche Bank’s stake in Station Casinos […]
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