Boyd chairman to alter his role

30 July 2007

LAS VEGAS, Nevada -- In the 1970s, it was easy for Boyd Gaming Corp. Chairman Bill Boyd and his father, Sam, to visit their company's casinos in one day.

Starting at the Eldorado in Henderson, the Boyds could stop by Sam's Town on the Boulder Highway and finish up the day at the California on Fremont Street.

As the company grew, adding the Stardust in the 1980s, going public in 1993, and expanding outside of Nevada to six different states over the past decade, the concept of visiting every casino became virtually impossible.

In announcing Friday that he would relinquish his role overseeing the day-to-day-operations of the casino company at the end of the year, Boyd, 75, explained the move was a way to get back to the old days, where he could have direct contact with customers.

Boyd Gaming President Keith Smith will add the title of chief executive officer starting Jan. 1 and take over day-to-day direction of the company, which recently broke ground on the $4.8 billion Echelon at the site of the now-imploded Stardust.

Current company Chief Financial Officer Paul Chakmak will take over Smith's duties as chief operating officer, and a new CFO is expected to be hired by the end of December.

"I'm not the retiring type. I just got my annual physical and I think I'm in better shape than I was 10 years ago," Boyd said. "We've been working on a succession plan since 2000 and I felt, after 32 years as either president or CEO, it was time to do something else."

Boyd will become executive chairman of Boyd Gaming, remaining as chairman of the company's board of directors and a member of the company's management committee. But he will now have time to visit the company's 17 casinos, not only the Southern Nevada properties but Boyd resorts in Atlantic City, Mississippi, Louisiana, Illinois, Indiana and Florida.

Sam Boyd, who founded the company with his son in 1974, died in 1993. The Boyd family currently owns 36 percent of the outstanding shares in Boyd Gaming.

"We used to spend a lot of time on the floor with the customers and the employees," Boyd said. "But as we got bigger, it was more difficult to do that. With Keith taking over the daily duties, I'll have more time to interact with both our guests and our workers. This was always an important element to our culture and our success."

Boyd said he felt comfortable making the transition in January; Echelon is under way, as is an expansion at the Borgata in Atlantic City. He also turning over the company's daily duties to a 17-year Boyd employee.

"I think that was the most important aspect of this transition," Boyd said. "Keith understands our culture and the style we do things. He won't miss a beat."

Smith, 47, was named Boyd Gaming president in 2005 and has been chief operating officer since 2001. He joined the company as corporate controller in 1990, and was promoted to senior vice president, He became executive vice president of operations in 1998. Smith has more than 25 years of experience in the gaming industry, including various executive positions with Aztar Corp.

Smith is also now vice chairman of the Las Vegas Convention and Visitors Authority's board of directors.

Smith said he doesn't expect any variation in the company's direction or strategy. Boyd continues to look for expansion opportunities across the country and in Las Vegas.

"What's nice is that I've been involved in all of the company's major transactions, from going public to Echelon," Smith said. "We don't foresee any great change in the way we operate. Bill is still part of the company and it's a natural transition."

Chakmak, 42, joined Boyd in 2004 as senior vice president of finance and treasurer. He was promoted to CFO in June 2006. Previously, he had been with CIBC World Markets' West Coast Leveraged Finance Group. Chakmak has more than 18 years of banking experience.

Deutsche Bank gaming analyst Bill Lerner didn't think Wall Street would have many concerns about the transition because of Smith's long tenure with the company. He said analysts know both Smith and Chakmak and have confidence in their abilities.


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