Nugget Makes Another Try for Hilton Shares

Golden Nugget Inc., a Las Vegas and Atlantic City, N.J., gambling hall operator, made a new overture Friday in its bid to buy a block of Hilton Hotels stock that has been tied up for five years in a probate court fight involving the estate of Conrad N. Hilton.

Golden Nugget Chairman Stephen A. Wynn told the estate’s executor in a letter that the terms of his firm’s April 3 offer of $72 a share, or $488 million, for the Hilton estate’s 6.78 million shares, as well as a prospective offer for the remaining stock in public hands, “are negotiable.”

The estate’s block amounts to 27.4% of the company’s common shares.

James E. Bates, executor of the hotel chain founder’s estate, said Friday that he had no comment on the latest communication from Golden Nugget. Conrad Hilton died in January, 1979.

Bates last week had rejected the original offer, calling it “insufficient.” That sentiment was echoed by Barron Hilton, son of the founder and current chairman, president and chief executive of Hilton Hotels.

There was no indication Friday of how--or even whether--Bates would respond to the new Golden Nugget overture.

A major unanswered question is whether Golden Nugget will launch a tender offer for Hilton stock even if it fails to buy the huge block held by the Conrad Hilton estate. Golden Nugget has hired New York investment banker Drexel Burnham Lambert and squads of lawyers as advisers to help it, should it decide to start a takeover battle.

Another question is whether Golden Nugget or anyone else will try to defeat a number of anti-takeover measures put forth by Hilton management for a vote at the scheduled May 2 annual stockholders meeting at the Beverly Hilton.

Management’s proxy statement indicates that more than 50% of the company’s shares are currently held by big institutional investors. In some recent proxy battles, institutions have weighed heavily in defeating such management proposals. Even without the 27.4% block of stock held by the Conrad Hilton estate, there is enough Hilton stock in the hands of financial institutions to carry or defeat any proposals if voted in concert.

The largest institutional holding of Hilton stock is a 9.4% block held by TCW Asset Management, an affiliate of Trust Co. of the West, a Los Angeles-based, independent trust firm specializing in fiduciary asset management.

After the Conrad Hilton estate’s shares, that holding is the only individual block amounting to 5% or more of the company’s stock, according to Hilton’s latest proxy. Officials of TCW Asset Management could not be reached for comment Friday.

The opening of Wynn’s letter to Bates was not particularly conciliatory.

“I was dismayed,” it began, “by your letter of April 3, 1985, hastily rejecting our $72 offer.”

Wynn’s letter said he believes that a “careful analysis” would persuade Bates that the bid was “fair and reasonable.”

Although the offer expired Friday, the letter noted, “I want you to know that we remain ready to consummate a transaction.”

Stating that the terms were negotiable, the letter said: “We and our investment bankers, Drexel Burnham Lambert Inc., remain ready to meet with you at a moment’s notice.”

The letter said Golden Nugget believes that Bates’ power to sell the shares was specific in Conrad Hilton’s will, adding:

“However, we would be happy to join with you in seeking a prompt determination of this issue from the probate court.”

Wynn wrote that his company has “a great deal of difficulty understanding your current position. “

HILTON HOTELS CORP. AT A GLANCE

Hilton owns, manages or franchises 253 hotels. Its wholly owned properties include New York’s Waldorf-Astoria, Chicago’s Palmer House and the Las Vegas Hilton. Nearly 4,500 rooms have been added in the past two years, mostly at managed or franchised facilities.

Hilton owns, manages or franchises 253 hotels. Its wholly owned properties include New York’s Waldorf-Astoria, Chicago’s Palmer House and the Las Vegas Hilton. Nearly 4,500 rooms have been added in the past two years, mostly at managed or franchised facilities.

In millions of dollars, year ended Dec. 31

1984 1983 Revenues $686.6 $682.9 Net income 113.9 112.6

12-month price range (NYSE): $73.50 - $45.50 Friday’s close - $68 Shares outstanding: 24.7 million Major Stockholders of Hilton Hotels Corp.

Number of Shares Owned Name as of Dec. 31, 1984 Estate of Conrad N. Hilton 6,782,289 TCW Asset Management 2,333,500 Allstate Insurance 688,744 McCowan Associates 526,100 Travelers Corp. 462,100 Colo. Pub. Employees Retirement 450,000 First Manhattan Co. 439,900 College Retirement Equities 407,700 Ohio State Teachers Retirement 324,900 Bankers Trust N.Y. 324,800