Griffin Revises Resorts Bid, Seeks to Upset Trump’s Voting Control
LOS ANGELES (AP) _ Entertainer Merv Griffin on Wednesday revised the price he is offering Resorts International Inc. but made the new bid contingent on the company agreeing to sell him new stock that would give him voting control.
Currently, control is held by New York-based investor Donald Trump, who owns nearly all of Resorts’ 572,000 in Class B shares. Those shares carry 100 votes each, giving him 88 percent of the company’s voting power.
The company also has 5.7 million Class A common shares that have one vote each.
Griffin’s new offer is for $36 per share for all of the company’s Class A stock and calls for Resorts to sell Griffin 1.2 million new Class B shares at the same price.
Griffin is no longer making his offer contingent upon Trump tendering his Class B stock or terminating a five-year management contract valued at about $100 million for Resorts’ hotel-casinos in New Jersey and the Bahamas.
If Griffin were successful, he would control a majority of the voting power and over 90 percent of the equity of Resorts.
Trump would be able to participate in Griffin’s new offer only by converting his stock to Class A shares.
Griffin, through his privately held investment concern the Griffin Co., made his revised offer to Resorts’ outside directors on the basis that only those board members should vote on the proposal.
″The other directors have interests in Mr. Trump’s competing bid,″ Griffin said.
Three of Resorts’ six directors are nominees of Trump, who is the company’s chairman.
Resorts referred media inquiries to Trump, who is the company’s chairman. Jack Nusbaum, Trump’s attorney in New York, said Trump would continue to use his voting power to resist Griffin’s offer and that it was unlikely Resorts’ outside directors would meet independently to consider the proposal.
Trump is offering $22 per share to buy the Resorts stock he doesn’t already own and take the company private.
In mid-March, Griffin countered with a bid of $35 per share, or $225 million, for all of the company’s stock, but it was contingent upon Trump tendering his stock and terminating the management pact. Trump has repeatedly indicated he wouldn’t agree to either contingency.
Griffin subsequently said he would boost his bid to $295 million, with Resorts’ board able to decide how to apportion the additional $70 million between Class A and Class B holders. The move was seen as a way to pay a higher price to Trump, but the New Yorker again said he wasn’t interested.