Wynn seeks to raise cash through new stock offer

Wynn Resorts said Tuesday it hopes to raise $175 million through its stock offering of up to 9.6 million shares the company announced late Monday.

The company priced the stock at $19 per share and plans to use the proceeds for general corporate purposes, including paying off debt.

But with speculation about MGM Mirage and Harrah's Entertainment being willing to part with Strip resorts in order to shore up their balance sheets, the stock offering and the company's liquidity fueled discussion that Wynn Resorts Chairman Steve Wynn might be a potential Strip shopper.

Goldman Sachs gaming analyst Steven Kent, however, doesn't believe Wynn will use the funds to purchase any on-the-market Strip casinos, such as the Bellagio, which Wynn built but was acquired in 2000 by MGM Mirage.

"Although there may be some opportunities to purchase assets over the next several months, we would be surprised to see Wynn pursue this, given its lack of a track record on acquisitions," Kent told investors.

The offer originally started out for 7 million shares, but was increased to 8.05 million, including additional options. Deutsche Bank Securities Inc. and Merrill Lynch & Co., which led the sale, have an option to buy an added 1.44 million shares.

Steve Wynn said last year he plans to buy back as much as $1 billion in debt to save $55 million in annual interest payments. In November, the company sold $340 million in stock after being added to the Standard & Poor's 500 Index.

"Wynn has managed their business and balance sheet better than anyone in Vegas," said Anthony Valencia, a managing director of Trust Co. of the West in Los Angeles, which owns the shares. "With the slowdown in Vegas, it's just prudent to have that cash."

Wynn rose $1.07, or 5.5 percent, to close at $20.72 on the Nasdaq National Market.

Bloomberg News contributed to this report.