New day dawns for Harveys
A new era dawns this morning for Harveys Casino Resorts.
Today is the company’s first full day as a subsidiary of Colony Capital, Inc., an international real estate investment firm with $4 billion invested in 50 properties worldwide.
It’s the first full day that family members of Harveys’ founders, Harvey and Llewellyn Gross, have not been involved in managing the company since 1944 when Harveys Wagon Wheel opened at Stateline.
Tuesday was the last day of trading for Harveys since 1994 when it opened on Wall Street at $14 a share. Harveys closed yesterday at $28.73 per share.
The $450 million acquisition of Harveys by privately-owned Colony Capital included the buyout of 10.9 million shares, about 40 percent owned by heirs of Harvey Gross.
It took a day short of a year to complete the transaction that was announced Feb. 3, 1998. Shareholders approved the merger in May.
“The Harvey Gross family should be very proud of what they’ve done for this business and for the Lake Tahoe community over the last 55 years,” said Chuck Scharer, Harveys president and chief executive officer, who will continue in that capacity under Colony Capital. “Harveys’ management team and our 4,000 employees are proud of the fact that we delivered to our initial public shareholders a return on their investment of over 100 percent. The future is bright for our company and the Colony investment positions us well to accelerate our growth.”
Although a lot has changed, much is expected to stay the same.
Harveys Casino Resorts’ senior management, including Scharer, Chief Operating Officer Steve Cavallaro and Chief Financial Officer John McLaughlin, will stay with Harveys under Colony’s corporate structure.
“In Harveys, we have acquired a group of premium assets and an exceptional management team,” said Kelvin L. Davis, Colony’s president and chief operating officer. “We believe that this company will be well positioned to avail itself of opportunistic consolidation and growth opportunities in the years ahead.”
With Scharer continuing to direct Harveys’ operations, the company will also stay active in the community and redevelopment, according to Davis.
Although management will stay, the heirs of Harvey Gross will move on to other ventures.
“We are very proud of the accomplishments and growth we have achieved at Harveys,” said Kirk Ledbetter, grandson of Harvey and Llewellyn Gross. “As we step away from Harveys, we leave a very positive legacy and successful business record in place.”
Ledbetter worked for the company a large part of his adult life, most recently as director of community services and governmental affairs. Last year, he ran unsuccessfully for Douglas County Commissioner.
“I plan on remaining in Lake Tahoe and remaining active on community boards and projects,” he said. “I am anxious to see redevelopment move forward and I see many positive opportunities as Lake Tahoe repositions itself as a leading destination resort area.
“With 22 years at Harveys and in the gaming industry, I will miss the daily challenges, the customers and most of all the employees that I have worked with.”
Jessica Ledbetter, Gross’ granddaughter and Kirk’s sister, has focused her efforts toward her Thunderbird Ranch in the Carson Valley, while also serving on Harveys board. She began her working years busing tables and parking cars at Harveys. As director of planning, she helped plan Harveys newest hotel tower.
“It’s truly going to be hard to drive to Tahoe and see the building and not be part of it,” she said, in a previous statement to the Tahoe Daily Tribune.
Though retirement age, William Ledbetter, Gross’ son-in-law and Kirk and Jessica’s father, will keep his office at Harveys another 11 years, he said last year. From there, he’ll remain active in the community and oversee the construction of his East Shore house, Wovoka.
Richard Kudrna, Sr., another son-in-law of Harvey Gross, folded hundreds of towels in the laundry of Harveys Inn before becoming part of the corporate structure. After many years on the board of directors, he plans to retire.
“After all the hard work, I’m ready to relax and enjoy some of the benefits,” he said last year.
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