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 he Good Gambler |
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| The Editor or one of
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| Kirk Kerkorian |
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| Sands Macao
Casino |
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| Sheldon Adelson |
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| Sol Kerzner |
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| Steve Wynn |
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| Casinos on the edge of change |
The
big wide world has been advancing quickly whilst the UK Government continues to
pontifficate on the subject of Gambling Legislation and more specificly, Casino
Legislation.
Over in Las Vegas the 87 year old Kirk Kerkorian is
about to take over the Mandalay Resort Group for $7.9 billion and at last be in
control of over half the 75,000 rooms on the Strip. In 1993 he open the world's
largest hotel on the Strip, the 5,034 room MGM Grand and in 2000 he took away
the Mirage Resorts from Steve Wynn for another $6.4 billion. The new
MGM-Mirage-Mandalay Group has however had its position as the largest casino
operator in the world taken away this week by the new boy in
town.
Nobody knew who Gary Loveman was until as this week. A professor
at Harvard Business school he has now taken to help running Harrah's
Entertainment as Chief Executive and his idea was not to allow MGM to take the
position of No. 1 for long. This week Harrah's will buy Caesars Entertainment
for $9.25 billion put their position in concrete as there is really no left to
buy, except one.
Sheldon Adelson runs Las Vegas Sands Inc., a private
company about to go public. LVSI owns The Venetian mega-resort and has also
just opened the Sands Macao casino in May and the Waldo in July in China's only
legal gambling district. Macao gets 70% of its tax revenue from the gaming
industry and these 2 new ventures have increased that by 32% in the first 5
months of the year. The LVSI company could float for $4 billion although
Adelson's policy of banning unions may make the properties he runs to hot to
handle for potential buyers. Adelson's unpopularity due his hard line approach
has made him inclined to move around with a team of ex-Mosad
bodyguards.
These changes don't seem at first glance to affect the UK
casino market but the UK government has proposed new changes in the likely
Gambling Bill scheduled to be debated in October that will invite big US
corporate raiding at the expense of the existing British players such as
Stanley Leisure, Grosvenor and Gala.
Traditional thinking in the city
was that relaxing the laws governing casino ownership would allow non-UK firms
to buys casino operations in the UK and so the price casino stock soared, even
as their performance tanked. Now however the bright sparks in the governement
have come up with a three tiered casino system. The are to be Small, Large and
Regional Casino definitions and only the Regional Casino type (a resort style
casino) will be allowed to have Slots with unlimited jackpots. These are the
sure-fire fantasy hooks that bring punters to the big casinos and pay for range
of alternative entertainment which the government has prescribed in the Bill as
necessary part of obtaining a license.
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All this indicates that now US giants
have no need for the backward and small UK casino chains but are able to launch
straight in on their own platforms with resort style casinos and actually
damage the profitability of the existing chains. Protests are being lodged
right now by the UK chains but they will have a hard time of it.
Someone
already pushing into the market is Sol Kerzner. Kerzner International, long
since extracating itself from Sun City in South Africa, is now in the
Caribbean, Mauritius, Dubai and the Maldives and will be here soon. More than a
year ago, in April 2003, his company had beem given permission to build a
casino in Northampton but the Gaming Board has been investigating Sol and his
company as to whether they are fit and proper. Only now have they said yes. Not
only that but last week it was announced that Sol Kerzner has just struck a
£550m deal to turn Greenwich’s empty Millennium Dome into a
gambler’s paradise, with gaming tables, 900 slots machines and a 600-bed
hotel. What’s more, pending legislation that will deregulate gaming later
this year, Kerzner is also poised to put a £200m resort casino into the
middle of Glasgow’s new SECC Clydeside development.
There however
some already here. Isle of Capri Casinos of Biloxi, MS, USA has bought
two-thirds of Blue Chip Casinos. They have just opened the Roman themed Rubicon
in Wolverhampton with one already in Dudley. Further more the Sorrento Casino
will open on Walsall in September and there are plans for an ocean liner themed
casino called The Queens in Warley.
But all the major foreign operators
want in, including the French group Accor which runs more than a third of
France's casinos and even Hilton International which just 4 years ago sold all
its UK casinos to Gala for £235 million.
Finally the new fad in
casino planning is to have a casino at a sporting venue. Gala plan a casino at
the Wloverhampton race track, West Ham are in talks with Sands Inc. (LVSI) for
a casino in their football ground as too do Rangers in Scotland and Sheffield
footballers can look to partnership with Sun International.
We're all
looking to October to shed some light on what exactly the government has got
planned. Until next time....
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