Las Vegas Weekly

August 29, 2008 · 12:10 PM

Rumors indicate a $100 million price tag for Pure?

By Robin Leach

Mystery surrounds a staggering possible $100 million price tag that allegedly has been placed on the sale of Pure Management Group’s colossal Vegas nightlife empire, according to well-placed rumors yesterday and this morning! Luxe Life has reliably learned from entertainment industry sources that the Pure executives have possibly agreed to sell their successful Pure and Lax nightclubs in a deal that may close as early as the end of September.

I have been told that an Internet music group has purportedly agreed to pay the $100 million proposed purchase price. However, the rumor mill says that only $50 million would be paid in cash and that the new would-be buyers have to raise the additional $50 million in investment funding prior to Sept. 30. Financing for Vegas "deals" in recent weeks has dried up and led to the cancellation or postponement of a number of Strip resort and nightclub projects.

Another buyer, a major California nightclub operator, ostensibly stands ready in the wings with a near $70 million all-cash offer if the music group is unable to raise the investor cash funding. I have been told that both deals already have the approval of a Beverley Hills investment fund that bankrolled much of PMG’s expansion when they opened LAX, the adjoining NOIR Bar and Company American Bistro restaurant, all in the Luxor. Allegedly, that mortgage loan calls for heavy interest payments that PMG has been making -- although sources say the $50 million plus principal portion isn’t repaid until a sale.

I must repeat, emphasize and caution that the "Pure is for sale" rumors are only that: rumors. Adding fuel was when I asked its public relations company for an official comment on the information that I presented to them. It took more than 24 hours before I received an ambiguous statement in response that was neither a denial nor a confirmation. “Pure Management Group is no longer going to comment on rumors of a sale,” stated KirvinDoak spokeswoman Kate Turner. On several previous occasions back in March and April, Pure stated more finitely, “No truth because PMG is not selling its nightclubs."

There’s no word yet on how a possible sale could affect Pure’s initial celebrity investors, including Andre Agassi, Shaquille O’Neal and Celine Dion. But the possible sale comes months after the IRS began an investigation into alleged reports of "skimming cash" from customers waiting on line to get VIP admission. Those allegations have been well reported both here in Luxe Life and the Las Vegas Sun newspaper. Click here for that reporting.

Luxe Life reported a month ago that the results of the IRS probe would be known within the next three months -- and now another blockbuster insider’s rumor: Allegedly a sealed indictment has been issued in the case and figures ranging from between $8 million and $20 million in cash are whispered to have been investigated by IRS agents. In addition, the IRS probe has allegedly centered on a series of expensive luxury automobiles, dazzling jewelry and palatial residential purchases. When I asked Pure’s PR folks about that legal development, I was told, “We have no comment on anything involving the current legal situation.”

— From Vegas Deluxe

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