Griffin Seeks Talks With Trump in Resorts Fight; SEC Begins Probe
LOS ANGELES (AP) _ Entertainer Merv Griffin’s investment company says it is seeking to meet with rival bidder Donald Trump in their battle over hotel-casino operator Resorts International Inc.
But Griffin at this time has no plans to further increase his $295 million offer, spokesman Mark Gill said Thursday.
Griffin and an attorney for Trump also disclosed separately that the Securities and Exchange Commission has begun looking into alleged violations of securities law in the Resorts fight.
In another development, Griffin announced that the largest holder of Resorts’ Class A common stock had withdrawn its support for Trump’s $22-a- share offer and asked a Delaware court to reject it.
The court must act on the offer because it was made as part of a proposed settlement of shareholder suits alleging that Trump’s initial offer of $15 a share undervalued the company.
Trump attorney Pamela Tikellis disclosed the SEC investigation in a letter to the Delaware court, linking it to ″very substantial gyrations in the marketplace″ for Resorts stock.
It attributed those stock price movements to statements by Griffin and an ally that ″have had a manipulative effect.″
Griffin also acknowledged that the SEC had begun gathering information in the probe but indicated that it was limited to allegations of violations by Trump, including the failure to promptly disclose a new and higher appraisal for Resorts properties in making his $22-a-share offer.
Griffin last week made an offer of $35 a share, or $225 million, for all of the company’s stock - its 5.7 million Class A shares, which carry one vote each, and its 752,000 Class B shares, which carry 100 votes each.
Trump owns 95 percent of the Class B stock, giving him control over 88 percent of the company’s voting strength.
This week, Griffin boosted his offer to $295 million. Except for a proviso that Class A shareholders receive an unspecified premium over the $35 offer, Resorts’ directors would be able to apportion the $70 million increase as they see fit. That was widely seen as a vehicle to shunt most of the money to Trump.
″We are prepared to sit down with Mr. Trump and the Resorts board to discuss obtaining a superior bid for the public stockholders and to satisfy the needs of all parties,″ said Michael Nigris, the president of Griffin Co.
Griffin spokesman Gill said the allusion to a ″superior bid″ referred to one that is better than the $22-a-share bid that Trump has made. Gill said Griffin has no plans at this time to again increase his offer.
Trump has repeatedly said he would not sell his stock - a condition required by the Griffin bid. Attorney Steve Gartner, representing Trump, said Thursday that the New York-based developer hasn’t changed that stance.
As a result of Trump’s objection, Resorts’ board has twice refused to pursue the offer on grounds it is moot.
The shareholder who defected from the settlement agreement with Trump was the investment firm of Tweedy, Browne Co., which owns 8.6 percent of Resorts’ Class A stock.
Trump, based in Atlantic City, N.J., has hotel-casino operations in New Jersey and the Bahamas.