Turner resigns as CEO at Circus Circus Settling his contract to cost a share

Ensign is new CEO


January 20, 1998|By BLOOMBERG NEWS

LAS VEGAS -- Circus Circus Enterprises Inc. said yesterday that Chairman and Chief Executive Officer Clyde Turner resigned, and that the casino company will take a fourth-quarter charge of 8 cents a share to settle his employment contract.

Turner, 59, led an expansion that included two casinos and the $800 million Project Paradise resort being built in Las Vegas. He is being replaced by Michael Ensign, also 59, vice chairman and chief operating officer, who is one of the company's biggest investors with about 6.5 million shares.

Turner exited under pressure for failing to boost Circus Circus' earnings and share price, analysts said. Its stock fell 40 percent in 1997 as the expansions and renovations at its Luxor and Circus Circus Las Vegas failed to improve returns on investment.

"There's been a lot of turmoil and a lot of pressure on the board and on management," said Bear, Stearns & Co. analyst Jason Ader.

Turner's departure is expected to fuel speculation that Las Vegas-based Circus Circus could be bought out, most likely by a real estate investment trust, analysts said.

REITs, which typically own properties such as hotels and office buildings, have shown an interest in recent months in buying casinos.

Circus Circus would not say how much Turner will receive under his employment contract. The charge includes severance pay and the cost of canceling stock options, said CIBC Oppenheimer analyst David Wolfe.

Pub Date: 1/20/98

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