Randy Black, that is. The CEO who ran the Mesquite market straight into the ground (with a sizable assist from the Nevada Gaming Control Board and Gaming Commission) and turned the former Si Redd’s Oasis into a slot route — a pathetic 16 machines — has kept his promise to put Black Gaming into bankruptcy. Under the new arrangement, most of the heavy lifting will be done out of South Point, now that Michael Gaughan has emerged as the power behind Black’s tottering throne.
Publicity ho Black makes a useful front man for the very media-shy Gaughan, who has also installed former Coast Casinos hand Anthony Toti at the levers of power (i.e., chief operating officer). Toti’s been around Black Gaming for a while but Randy B. was pulling all the important strings at the time. Unfortunately, as is so often the case, debtors will take a scalding bath. By dint of an $18+ million cash infusion, Black’s debt will go from $200 million to $62.5 million — roughly a $120 million haircut. The knowledge that Black Gaming’s operations will now be in more competent hands is very small consolation by comparison.
No trouble in River City. The new Pinnacle Entertainment property got a rave today from J.P. Morgan, which used terms like “beautiful” and even invoked comparisons to Wynn Las Vegas and Encore. High praise indeed. The $357 million price tag indicates that you can build a marquee regional property without blowing the bank (Sheldon Adelson, Frank Fertitta III, Don Barden take note) — albeit sans hotel, one must acknowledge — and management appears to be shooting for a 14% ROI … hardly a preposterous goal at that cost. In Wynn-like fashion, River City features wide aisles. It has 2,100 slots and 55 table games, which is probably a judicious mix now that lifting of wager limits in Missouri has turned out to be a mild panacea.
In terms of a Vegas analogy, one might say that River City is going to be Boulder Station to Lumiere Place‘s Red Rock Resort, or Sam’s Town to its Stardust (except we don’t have a Stardust anymore — sniff!). WMS Gaming is the big winner on the slot floor, representing 30% of the inventory, with Konami (12% of the machines), emerging as Pinnacle’s fair-haired boy: “their games were performing extremely well across PNK’s portfolio.” IGT was perceived as the loser in terms of market share.
Rather more depressingly comes news that, while the CEO search is down to two or three finalists, the lucky [?] winner is expected to be “more of an operator than a developer.” Dan Lee-style big-idea guys (and gals) need not apply. Since the chairman and CEO positions will be severed, this confirms S&G‘s suspicion that COB Richard Goeglein is looking for a flunky CEO and will continue to pull the strings. Considering that Goeglein’s signature achievement was the Aladdin 2.0, the New Coke of casinos, this is not a heartening turn of events.
Former casino regulator and federal judge Brian Sandoval continues to pile up GOP endorsements in his gubernatorial bid. Two of his key backers, Reno Mayor Bob Cashell and state Senate Minority Leader Bill Raggio (as crusty a character as I’ve ever met), were on the receiving end of public screw-overs by Gov. Jim Gibbons — multiple ones, in Raggio’s case. Unfortunately for Midnight Jim, he’s finding that his fuck-you style of governance is coming back to bite him in the butt … within his own party.
Having observed and dealt with Sandoval during his pre-judicial years, I’d have no qualms pulling the lever for him. Considering that Gibbons is in the process of dismantling Nevada‘s regulatory apparatus, one would hope and expect that Sandoval will lend a more sympathetic ear to the Nevada Gaming Control Board‘s staffing and funding crises.
However, Jon Ralston spots a ray of hope for Midnight Jim, based on his Gumby-like performance during the recent special session. Archon Corp.’s Sue Lowden, meanwhile, is starting to show up on that national radar — more bad news for Sen. Harry Reid (D-NV). Poor old Hapless Harry; all that water-carrying for Big Mining, Big Real Estate and Big Gaming down the drain.
Happy birthday, Dr. Seuss. An S&G reader reminds me that today is the birthday of Dr. Seuss. In his memory, here is a great Saturday Night Live moment. Lorne Michaels had the inspiration to mark the great author’s passing by having Green Eggs & Ham recited by the Rev. Jesse Jackson and the rest is comedic history.
David,
I don’t think that I agree with your Vegas analogy for the Pinnacle pair in St Louis if I’m understanding you correctly. The downtown Lumiere is not the place to be. The two leaders are in the western suburban area of St Louis/St Charles, those being Ameristar and Harrahs. I’m pretty sure that River City in south St Louis County will quickly become number three in the area, leaving big brother Lumiere in its wake. Lumiere will have to count on convention and tourist visitors, not St Louis’ strong suit other than Cardinal baseball in the summer. River City is in a safe, easily accessible area that is far more welcoming to the suburbanites that will make up most of its customers. My brother attended the soft opening for VIPs and construction managers (he being the latter) and was impressed. Maybe I’m misunderstanding your analogy but I’m pretty sure River City will be the cash cow for Pinnacle in the Lou. I can’t say that I can come up with an analogy for the pair in Vegas. Closest I could think of is Lumiere being the Golden Nugget and River City being the Mirage way back in the early 90s. The Nugget is attractive but in an area some deem sketchy while the Mirage was the new kid in town in a better area where people want to be. Even that is not a fair analogy as I feel safer in downtown Vegas than I ever would in downtown St Louis. Needless to say I’m not a spokesman for the St Louis Downtown Visitors’ Bureau.