Hilton Wins OK for Bally’s Settlement

Beverly Hills-based Hilton Hotels Corp.’s $97.5-million settlement with Las Vegas-based Bally’s Grand Inc. shareholders was approved by a Delaware judge, over the objection of some shareholders. Under the settlement, Hilton agreed to buy Bally’s Grand shares it doesn’t already own for $52.75 each and to pay $42.75 for each outstanding stock warrant to end a legal fight over Bally’s Grand’s planned Parisian-themed casino resort in Las Vegas. Hilton bought a majority stake in Bally’s casino properties in 1996. Delaware Vice Chancellor Jack Jacobs in Wilmington said it appears that the settlement is fair, citing shareholders who are content with the agreement. Some Bally’s Grand shareholders had said that glowing earnings prospects for the $600-million casino resort, scheduled to open on Las Vegas’ strip in 1999, means their shares and stock warrants should be worth at least $122 each. Attorneys for Hilton argued that it’s difficult to assume the hotel would make a profit. The settlement would resolve a lawsuit by Bally’s Grand shareholders seeking to overturn last year’s sale of the casino project to the company’s majority shareholder at the time--Bally Entertainment Corp., which Hilton acquired. Shares of Bally’s Grand rose 13 cents to close at $50.88 on Nasdaq. Shares of Hilton fell 69 cents to close at $33.94 on the NYSE. Separately, Hilton agreed to buy the century-old Atlantic City Country Club for an undisclosed price, making it the only casino company in the area to operate a golf course.