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LAS VEGAS, Nevada -- Shares of Las Vegas Sands Corp. reached an all-time high Wednesday, climbing 11 percent after a gaming analyst said the company won approval from the Chinese government to develop a nongaming resort complex on Hengqin Island near its expanding casino operations in Macau.
The company announced plans for Hengqin in October 2005, saying it would spend $1 billion to construct nongaming attractions on the 1,300-acre parcel, such as resort villas, golf courses and a marina.
At the time, company officials said the concept was to offer other attractions to customers at Las Vegas Sands-operated casinos in Macau and on the Cotai Strip. Las Vegas Sands runs the Sands Macau and is expected to open the $2.4 billion Venetian Macau later this year on Cotai, the first of eight casino-hotels on the location.
Las Vegas Sands rose $10.43 on the news to close at $102.81 on the New York Stock Exchange. The shares hit a 52-week high of $103.08 during the day, easily surpassing the high of $97.25 set Dec. 6.
But questions surrounded the news. Las Vegas Sands did not announce the development to the market as a whole and the stock reaction appeared to be on an analyst's report, written by Larry Klatzkin of Jefferies & Co., that was released just before 11 a.m. Wednesday.
Klatzkin said in the research note that company management told him about the approval Wednesday. Reached late Wednesday, Klatzkin would not comment beyond what was in the note.
The planned 2,000-acre complex to be built over 11 years is worth $34 a share, Klatzkin wrote, reiterating an earlier valuation. He rates the shares as "buy." In late November, the New York-based analyst raised his price target on Sands to $124.50.
"After speaking with management today, we learned that LVS was officially granted the right to develop Hengqin Island, as we expected," Klatzkin wrote. "Management indicated they are hoping to break ground before the Chinese New Year (on Feb. 14)."
Las Vegas Sands officials did not return repeated phone calls Wednesday afternoon.
Speculation on financial Web sites late Wednesday centered on why Las Vegas Sands did not formally announce the development.
Bloomberg News contributed to this report.
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