Quest to top US rich list

LAS VEGAS: Sheldon G. Adelson, the casino mogul, has seen his personal net worth plummet by more than US$15 billion (US$1 = RM3.28) in recent months as Wall Street investors have grown more bearish about the casino companies that are pushing aggressively into Asia.
That slide might put a crimp in his stated goal of surpassing Bill Gates and Warren E. Buffett, the only two titans ahead of him on Forbes' most recent list of the country's richest people. But a few miserable months on the financial front are not likely to have much of an impact on him - or the charities and various conservative political causes he supports.
Adelson, 74, still holds US$19 billion worth of stock in the Las Vegas Sands, which operates the Venetian here and also a pair of giant casinos in Macao, the Chinese territory near Hong Kong that has surpassed the Las Vegas Strip as the world's top gambling market.
On Thursday, the Venetian formally opens its new Palazzo tower. At 7,200 rooms, the expanded Venetian is the world's largest hotel.
Few Americans have made as much money in China as Adelson, and he is a major donor to the Republican Party. Yet Adelson may well be the richest American that most people have never heard of. One explanation for his relative anonymity is that he is a newcomer to the highest altitudes of the fabulously wealthy.
The Las Vegas Sands went public in December 2004, and over the next two years his net worth soared by US$17.5 billion. That works out to almost US$1 million an hour, weekends, holidays and nights included. "He got richer faster than anyone else in history," said Peter W. Bernstein, co-author of "All the Money in the World", a book about the people on the Forbes 400 list.
Certainly people in Las Vegas know Adelson, a querulous figure who has existed in a near-constant state of embattlement since building the Venetian in the late 1990s. He filed claims and counterclaims against scores of contractors who worked on that project, and over the years he has started legal fights with the local A.C.L.U., the Culinary Workers, the Las Vegas Convention and Visitors Authority and even the power company, which he thought should pay the cost of removing utility poles from the Venetian site.
"Sheldon is a brilliant businessman, but he can be enormously difficult," said Gary Loveman, chief executive of Harrah's, the Las Vegas-based casino giant. "When he has a strong point of view, he pursues it very stridently. He's very tough," Loveman added. "Some would say unreasonably tough."
Adelson declined to comment on this article, despite repeated requests. But longtime friends and associates said his hard exterior was rooted in his days growing up in a rough-and-tumble section of Boston, where his father drove a cab.
"Rich in our neighbourhood then was having US$3 in your pocket," said Irwin Chafetz, a Sands board member and former business partner who has known Adelson since grade school. Today, Chafetz's childhood friend owns homes in Las Vegas, Malibu, Boston and Tel Aviv, and keeps several jets, including a Boeing 767, a 747 and a 737.
Adelson started a business selling toiletry kits to motels, tried his hand at the mortgage broker business, and in the 1960s he joined Chafetz and another friend from the old neighbourhood, Ted Cutler, in a charter tours start-up.
But it was not until he founded Comdex, the premier computer trade show through much of the 1980s and 1990s, that he hit on an idea that propelled him into the upper reaches of the wealthy.
To this day, Cutler is not sure if his longtime friend even knows how to use a computer ("we always had people working for us who understood them"). But then a passion for technology was not what spurred Adelson, a college dropout then in his mid-40s, to create this yearly festival for technology buffs held every November in Las Vegas.
Rather, friends and former work associates said, he was enthralled by the idea of renting convention space for 25 cents a sq ft and selling it to vendors for US$25 or more. Adelson's timing on Comdex could not have been better - yet he seemed to feel more pressure, not less, according to former colleagues.
"His yelling was legendary," said Peter B. Young, a public relations man who worked with Adelson for the 17 years he ran Comdex. Sometimes Adelson turned his fury on a particular person, Young said, but often it was just "generic yelling" that seemed his boss's preferred way of passing along routine marching orders.
"To work with Sheldon you need to have a coat of Teflon," said Jason Chudnofsky, chief executive of Comdex under Adelson from 1987 to 1995.
It helped that his demanding and exacting boss was helping to make him rich, Chudnofsky said - and that his rants seemed largely about his own larger ambitions.
"Sheldon wanted to be richer than Bill Gates," he said. "He always wanted to be No. 1."
To accommodate their growing trade business, Adelson and his partners - Chafetz, Cutler and Jordan Shapiro, an optometrist from the old neighborhood ("the boys," as they were often called internally) - bought the aging Sands Hotel and Casino from the financier Kirk Kerkorian for US$128 million.
"The Sands had enough land to build a convention centre," Chafetz said. "That's why we got into the casino business." When it was completed, at the start of the 1990s, the Sands Expo and Convention Center stood as the largest privately owned exhibition centre in the country.
In 1995, Adelson sold Comdex to Softbank of Japan for US$862 million - giving him a personal payoff of just over US$500 million. He and his partners were all in their 60s, but where the three other ''boys" chose to semi-retire, Adelson made even bigger bets.
He demolished the Sands in a spectacular implosion (replete with an anticipatory fireworks show), borrowed hundreds of millions of dollars and in its place built the Venetian, which cost US$1.5 billion and opened in 1999.
With the Venetian, Adelson broke the basic rules of casino design by building a facility that was geared toward conventions rather than centred on the casino. Where the old way was to motivate guests to spend time on the casino floor by offering few amenities in the room, the Venetian parted from Las Vegas tradition, installing mini-bars and fax machines in each guest room.
His plans were met with scepticism, if not scorn. But the Venetian is now the Strip's second most profitable casino hotel, behind only the Bellagio, said Robert A. LaFleur, an industry analyst with the Susquehanna Financial Group, and that is with only a third of its revenue coming from its gambling floor.
"He's shown people in Las Vegas that there's a different way to do things," said Mike Sloan, a retired casino executive who now consults for the MGM Mirage and other gambling concerns.
Yet despite the influential role he played in establishing Las Vegas as a top convention destination, he is better known locally for his quarrels and legal battles. To cite but one of a long list of examples: his attempts to bar members of the Culinary Workers from picketing on the sidewalk in front of the Venetian, a case he pursued all the way to the US Supreme Court (he lost). The Venetian is the only major Las Vegas casino that is non-union.
Then there is his long-running feud with Stephen A. Wynn, who built the Mirage and Bellagio, among other large Strip properties. The two tycoons have fought over everything from the noises emitted by the artificial volcano in front of the Mirage to the size of the Venetian's parking garage.
"Sheldon is a man who harbors a lot of animosity toward a lot of people," Wynn said. "And when Sheldon is angry, he gets nasty."
The two are at it once again, this time in Macao - and so far, a stock market correction notwithstanding, Adelson is beating his longtime foe. He already runs two resorts in Macao (one has a casino three times the size of Las Vegas' biggest gambling floor), and his company, the Las Vegas Sands, is in the midst of spending another US$7 billion to US$9 billion building an additional 13 hotels there. The Sands is also spending another US$3.6 billion on a casino hotel in Singapore.
Wynn who is less bullish on Macao's short-term prospects than Adelson, operates a single property in Macao.
"So much of their value is on the come, as they say in the gambling business," said LaFleur, the analyst, explaining the inflated price of Sands stock relative to Wynn Resorts and other competitors.
Adelson has five children from two marriages. He has given tens of millions of dollars to charitable causes, most of them Jewish-related, and has talked about donating billions more to foster medical research.
Last January he gave US$1 million to American Solutions for Winning the Future, former House Speaker Newt Gingrich's political group, and more recently he helped finance Freedom's Watch, a conservative response to MoveOn.org.
Yet Adelson is hardly slowing down to enjoy other aspects of life. He is looking past Asia, already talking about replicating his Macao strategy and creating a mini-Las Vegas somewhere in Europe.
"I work for a guy who's obsessed," said Robert G. Goldstein, one of a troika of top executives who have been with Adelson since 1995. Every time the Sands reaches another milestone, Goldstein said his boss establishes a new, harder-to-reach goal.
"He has more money than he can ever spend but he has to grow it bigger," he said. - NYT