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Gaming Guru

Howard Stutz

Las Vegas Sands president signs contract extension

14 June 2012

Las Vegas Sands Corp. President Michael Leven celebrated the birth of his sixth grandchild in April.

After 2014, Leven will have much more time to dote on his newest grandson.

The company announced Wednesday that Leven, 74, signed an extension to his employment agreement that will keep him at the helm of the casino operator until the end of 2014.

By that time, Leven said, Las Vegas Sands would have his eventual replacement ready to step in.

During 2013, the company's board of directors will begin the search for the next president. Investors and the financial community are comforted when a business has a succession plan, he said.

"I'm not getting any younger," said Leven, who spent almost 50 years in the hospitality industry before being named president and chief operating officer of Las Vegas Sands in April 2009. Leven had been a member of the company's board since 2004.

He doesn't view the next two years as a retirement tour, however. Leven will head Las Vegas Sands' expansion opportunities that could find the company building resorts on several continents.

"We have a terrific development team, and hopefully some of this will come to conclusion in the next year and a half," Leven said.

The company is on solid footing, Leven said, after a near financial collapse in late 2008. The casino operator collected more than $6.85 billion in revenues in 2011 - a 50 percent jump over 2010 - from The Venetian, Palazzo, three resorts in Macau, a casino in Pennsylvania and the Marina Bay Sands in Singapore.

Challenges slow the spread of gaming

In the first quarter this year, Las Vegas Sands collected $2.76 billion in revenues, of which roughly 83 percent came from its Asian holdings.

The company is completing its $4.4 billion Sands Cotai Central development in Macau, which opened in April. An additional phase opens next year. Las Vegas Sands is drawing up plans to develop another site on Cotai and awaits approval of the Macau government.

In the meantime, the company will spend $500 million this year on capital improvement projects, including several renovations and changes at its Strip resorts.

Leven's biggest task over the next two years will be directing the company's possible development steps. The process can be somewhat arduous, Leven said.

Of late, Las Vegas Sands has been linked with potential integrated resort and casino projects in Spain, Korea, Japan, Vietnam, Toronto, New York City and Miami. Political, social and other outside challenges have slowed the potential gaming expansion opportunities.

"We have the unique opportunity of being able to reinvest in our current properties, but we can also seek out any other growth opportunities," Leven said. "That's a powerful combination."

The only overhang seemingly on the company are lawsuits by former employees, including a wrongful termination case involving the company's former CEO in Macau, Steven Jacobs. His allegations that Las Vegas Sands wanted to bribe Macau government officials brought about investigations by the U.S. Department of Justice and the Securities and Exchange Commission concerning potential violations of the U.S. Foreign Corrupt Practices Act.

Leven hopes the issues could be resolved by the end of the year, although he has no idea how long the legal process surrounding the Jacobs trial will take.

"The market has already taken into account the investigations," he said. Shares of Las Vegas Sands closed Wednesday at $45.25, down 47 cents or 1.03 percent on the New York Stock Exchange.

Adelson praises leven's contribution

In a filing Wednesday with the SEC, Las Vegas Sands said Leven had signed the contract extension but did not reveal a base salary figure. Leven was awarded 300,000 restricted shares in Las Vegas Sands with a price per share subject to several conditions.

In 2011 Leven had a base salary of $3 million. However, according to the company's proxy statement, his earnings were enhanced by more than $20 million, including $17 million in stock awards.

"Under Mike Leven's leadership our company has experienced tremendous success," Las Vegas Sands Chairman Sheldon Adelson said in a statement.

Leven hopes the company will make two development announcements in the next 18 months.

"We have the financial capability to do a number of these deals," Leven said. "And our balance sheet grows stronger by the day."

Leven's contract extension capped several management moves made by the company in the past year. Global Gaming President Rob Goldstein had his contract extended while the casino operator hired gaming and lodging veteran Chris Cahill as executive vice president of operations.