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Starwood may crap out
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April 12, 1999: 3:13 p.m. ET
Upscale resort confirms it's looking to sell its volatile Caesars casino unit
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NEW YORK (CNNfn) - The on-again, off-again discussions to sell Starwood Hotels and Resorts Worldwide Inc.'s multi-casino gaming business is back on again, the company said Monday.
While declining to comment on potential buyers or a purchase price, the upscale resort operator did confirm it is exploring disposing of its Caesars' business line, which consists of 11 casinos in Las Vegas, Atlantic City, N.J., and other locations around the country.
Starwood reiterated there is no guarantee at this point "that any transaction will occur" and further stressed it isn't operating on any self-imposed timetable.
Rumors first surfaced in January that Starwood was looking to sell the Caesars casino operations to Park Place Entertainment for upwards of $3 billion.
At the time, company officials played down the rumors, noting Starwood was still in the midst of its pledge to operate the casinos for at least 18 months prior to absorbing them as part of its 1998 acquisition of ITT Corp.
There were no such comments Monday as analysts noted the company likely had experienced enough of the turbulent casino industry.
"I think the last quarter in particular has given them a new perspective of the volatility that comes along with that business," said John J. Rohs, an analyst with Schroder & Co. in New York. "I believe they would love to get rid of everything in one fell swoop."
"At the end of the day, assuming the price is right, it's a good strategic move for [Starwood]," said Jason N. Ader, an analyst with Bear, Stearns in New York. "The gaming business is very volatile and overall, it's hurting their valuation multiple right now."
Market sources again fingered Park Place Entertainment as the most likely buyer Monday, although billionaire Sheldon Adelson and Hyatt International Corp. also have been named.
A Park Place spokesman said declined to comment on his company's possible involvement in the negotiations.
Starwood was down 1/16 at 32-3/16 in early morning trading while Park Place Entertainment was unchanged at 8-3/4. 
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