Reject London Clubs Proposal to Reward Senior
Officers Involved in Aladdin Hotel & Casino Debacle
|LAS VEGAS -- March 24, 2004 -- Today, a US casino
workers union called on UK shareholders of London Clubs International PLC
to vote down a company proposal to reward the senior officers with a long-term
stock option plan who were involved in a Las Vegas venture that brought
the company to the brink of collapse.
"We represent over 80,000 gaming workers in the United States," said Maya Holmes, Culinary Workers Union, Local 226 Research Director. "More than 50,000 of those workers are in Las Vegas casinos. We have seen first-hand how LCI senior officers run the Aladdin Hotel & Casino. Las Vegas is an extremely competitive market and the LCI senior officers failed. We were shocked to see the company wants to reward these senior officers with long-term stock option plans."
Between LCI's December 1997 announcement of the Aladdin venture and the March 2004 Rights Issue proposal, LCI's stock price fell 64 percent. Since their assignment to the Aladdin project in 1999, LCI's senior officers' remuneration package has increased an average of 93 percent. "We don't understand why LCI wants to reward these executives given how much shareholders have suffered," said Holmes.
"LCI claims deregulation of the UK gaming market means competitors, and US companies in particular, will try to poach senior staff," said Holmes. "I really doubt competitors will seriously consider LCI's senior officers who have the Aladdin project at the top of their resume."
On 5 March 2004, LCI announced a 1-for-2 Rights Issue to raise approximately GBP 49 million at an issue price of 70 pence per share. The new funds are integral to refinancing GBP 180.5 million in debt largely incurred by LCI's ill-fated foray into Las Vegas via the $1.05 billion Aladdin project. The LCI proposal includes a long-term incentive plan for senior employees. An extraordinary general meeting will be held on 29 March 2004 for shareholders to vote on the proposals.
Culinary Workers Union Local 226
702 386 5249
|Also See:||London Clubs International and the Sommer Family Trust are the Biggest Losers in Aladdin Bankruptcy / July 2003|
|Aladdin Resort & Casino's Inexperienced Owners, Poor Design Lead to Disaster / Aug 2002|