Dr. Miriam Adelson, the majority owner of Las Vegas Sands (LVS), is reportedly seeking to acquire a controlling stake in the NBA franchise, the Dallas Mavericks, from current owner Mark Cuban. The potential deal, estimated at $3.5 billion, follows the announcement that Dr. Adelson would sell 10% of her LVS stake for $2 billion to fund the acquisition of an unnamed sports franchise. Mark Cuban is expected to retain control of basketball operations in this proposed partnership, reflecting a strategic alignment with LVS’s interest in Texas’ gaming industry.
Acquisition Details:
Dr. Miriam Adelson is looking to purchase a controlling stake in the Dallas Mavericks from current owner Mark Cuban for an estimated $3.5 billion.
The move follows the announcement that Adelson will sell 10% of her stake in LVS for $2 billion to fund the acquisition of a sports franchise.
LVS’s Strategic Interest in Texas:
Mark Cuban’s interest in partnering with LVS for an integrated resort in Texas, contingent on the state legalizing commercial casino gaming, aligns with the potential acquisition of the Dallas Mavericks.
The synergy between LVS’s gaming interests and Cuban’s basketball franchise ownership reflects a strategic move into the lucrative Texas market.
Financial Impact on LVS Shares:
Following the announcement, LVS shares experienced a 3.5% decline in value, with the news also affecting Macau-listed names, as noted by investment bank JP Morgan.
The sale of Dr. Adelson’s stake is set at $44.00 per share, with LVS agreeing to repurchase $250 million worth of these shares.
Analyst Perspective on Macau Operations:
Analyst DS Kim emphasizes that the sale of Dr. Adelson’s stake has no impact on Sands China’s operations, as she was not involved in the business nor held any position related to the Macau-based subsidiary.
The transaction is viewed as distinct from LVS selling stakes or conducting a placement, with LVS actively repurchasing a portion of these stakes.
Macau’s Ongoing Recovery:
DS Kim maintains a positive outlook on Macau’s ongoing recovery, anticipating November Gross Gaming Revenue (GGR) to be around MOP$16 billion, reflecting mass GGR at 100%+ of pre-COVID levels.
The expectation is for 4Q mass GGR to outpace seasonality, growing at +11% quarter-on-quarter, pushing industry EBITDA to recover to 85%+ of pre-COVID levels in 4Q23.
The potential acquisition of the Dallas Mavericks by Dr. Miriam Adelson, using funds from the sale of her LVS stake, marks a strategic move aligned with Mark Cuban’s interests in the Texas gaming market. While the announcement had a modest impact on LVS shares, analysts emphasize that it does not affect the operations of Sands China. With a positive outlook on Macau’s recovery, the industry anticipates robust performance in the coming quarters.