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Aladdin makes $600M bid disappear!

Dec 24, 2002 6:02 AM

   A $616 million bid for the Aladdin has been deep-sixed by operators of the bankrupt Strip resort, GamingToday has learned.

   The offer — $541 million for the purchase with $75 million pledged for capital improvements — came from a trio of gaming veterans who have a combined 100 years of casino management experience in Las Vegas, Atlantic City and the Caribbean.

   The anonymous group’s offer was submitted in early November, and came with a promise to put up $75 million in cash within 24 hours of signing. It topped by more than $100 million last week's rumored offer from Planet Hollywood and Starwood Hotels & Resorts Worldwide.

   But, curiously, the higher bid was never made public by the Aladdin or its brokers. As recently as Dec. 2, Aladdin executives told U.S. Bankruptcy Court Judge Clive Jones that they had received “no serious bid.”

   “We don’t know what’s going on. But it’s pretty obvious that [Aladdin President] Bill Timmons doesn’t like us very much,’’ said one of the trio of would-be buyers.

   Sources tell GamingToday that Aladdin execs may be dragging out the long-simmering sale process for personal reasons. With the property in bankruptcy, top managers have been guaranteed pay running up to double their salaries as an inducement to stay on.

   Under this program, Timmons is reportedly pulling down $1 million a year. The chief financial officer is said to be making $600,000 and the human relations director is allegedly receiving $400,000 annually.

   Aladdin officials would not verify those figures. But a spokesman confirmed that substantial salary bonuses have been paid while the resort remains in bankruptcy.

   According to the latest legal extension of time, the Aladdin and its London Clubs owner have until April to come up with a new financial plan.

    “They’re just sitting on it, and getting paid handsomely for it,’’ complained the jilted bidder.

   The bid selection process is a secretive affair, with executives for the Aladdin and KPMG reviewing proposals. They are not required to disclose all bids to the bankruptcy court.

   Hotel officials declined to divulge how many bids have been received, explaining that they are bound by confidentiality rules. They did say, however, that the review process is “thorough and extensive.”

   But the would-be buyers charge that the Aladdin management team is anything but competent.

    “We think a lot of mistakes have been made there. And it’s not just about a bad design at the front entrance.’’

   Citing one example, a source noted that casino managers removed the plastic spacers in the blackjack racks. The spacers, typically placed between every 20 chips, allow floormen and pit bosses to quickly see how many chips are in stock.

    “For a one-cent saving, the floormen were having to lean in and count the number of chips. This offended players who thought the pit bosses were getting nosy. It made them nervous,’’ the source said.

   In another instance of poor customer relations, a player betting $10,000 a hand was told he could not get a pass to the Aladdin’s gourmet room because he wasn’t playing in the London Club room.

   “The management is just inept,’’ said the $616 million bidder. “What we’ve heard is that Timmons is close to Planet Hollywood and that he’s working on a deal that will let him stay on if Planet Hollywood takes over.

   “But I’ll tell you this: If we’re in, he’s out.’’

 

 

Timmons was not available to speak to GamingToday.