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Riv Acquisition responds to Riviera's rejection of its proposal, says let shareholders decide
By Lisa Kerner
Charlotte. N.C., March 30 - Riv Acquisitions Holdings Inc. wants Riviera Holdings Corp. to drop its opposition to the private investment group's $27.00-per-share offer and let shareholders consider the offer instead.
Riviera's board said it could not consider the merger proposal because Riv Acquisition Holdings entered into a lockup and option agreement for 9.2% of Riviera's outstanding stock held by Triple Five Investco LLC and Dominion Financial LLC without prior approval by Riviera's board.
However, Riv Acquisition's Paul C. Kanavos said in a letter to the board that it had "already granted us a waiver of the anti-takeover provisions in Riviera's articles of incorporation as well as the business combinations provisions in the Nevada corporate statute."
Kanavos also pointed out that "nothing in Riviera's articles or the Nevada corporate statute prevents the board from engaging in discussions with us or recommending our proposal to the stockholders."
The investor group said it had acquired all of the stock previously owned by Riviera's chairman and chief executive officer at $15.00 per share and previously entered into a board-approved merger agreement with Riviera at a price of $17.00 per share.
Riv Acquisition plans to send the Las Vegas hotel company's board an executed merger agreement.
"We expect that Riviera's stockholders will hold the board accountable if it continues to ignore its fiduciary duties," the letter stated.
Riv Acquisition consists of Paul C. Kanavos and Robert Sillerman, the managing members of New York-based Flag Luxury Properties, LLC; Las Vegas developer Brett Torino and Starwood Capital Group chairman and chief executive officer Barry Sternlicht.
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