Kings for a day; Covid’s casino kingpin

Congratulations to the Las Vegas Raiders, whose stunning (both to bookies and us) upset of the heavily favored Kansas City Chiefs made yesterday a good day for bettors on the Silver and Black. (And the Raider secondary, shredded by the Buffalo Bills, has improved beyond recognition.) The Malosos‘ victory helped roil NFL betting lines for next week. So did the 43-17 beatdown of the San Francisco 49ers by, of all people, the Miami Dolphins. Sic transit gloria Super Bowl. The Raiders are off next week but an aggregation of FanDuel, DraftKings, PointsBet, SugarHouse and BetMGM shows the 49ers dropping to three-point underdogs against the Los Angeles Rams. Odds on next weekend’s Chiefs/Bills tilt are being held hostage to Tuesday night’s postponed Bills/Tennessee Titan game, which should have bettors on the tips of their fannies.

TheLines.com, meanwhile, is predicting that next weekend’s marquee matchup of the Green Bay Packers and Tampa Bay Buccaneers (and we never thought we would type that sentence) will be “the final duel” of Aaron Rogers and Tom Brady. The GOAT would surely dissent, especially after zipping five TD passes in his most recent start. If you like underdogs, there’s always the Cincinnati Bengals (-9.5) against the Indianapolis Colts. The Minnesota Vikings are predicted to rack up a 56.5 over/under versus the incompetent Atlanta Falcons. And what sin did Jim Nantz and Tony Romo commit to be sentenced to covering a someone-must-lose match between the (still) winless New York Giants and the (then-) 1-3 Dallas Cowboys, game rife with meaninglessness?

Pay no attention to the man behind the curtain, especially if it’s Soo Kim, co-founder of hedge fund Standard General, the string-pullers of Twin River Holdings. Kim’s Coronavirus-inspired strategy is to look for Covid-depressed casino assets and snap them up. The most dramatic instance of this was Twin River’s $25 million acquisition of Bally’s Atlantic City. “A lot of casino companies, due to their balance sheets going up too high, are in tough shape now and are not prepared to take advantage of this regional opportunity,” explained Kim. Presumably it was Kim who talked Twin River into paying an extravagant $120 million for Jumer’s Casino Rock Island, a herculean turnaround project. He was also the architect of a deal that saw Twin River obtain Eldorado Shreveport and Montbleu in Lake Tahoe for $155 million. The Eldorado riverboat alone was going for $230 million before Maverick Gaming pulled the plug on the acquisition. Those three casinos went for 3.6X EBITDA, according to Kim, an unheard-of bargain. “Even if these casinos are closed for two years, it’s a good deal.” He’s right.

Twin River now has 11 casinos, a horse track and a baker’s dozen of Colorado OTBs. Nor is their any sign that it’s sated. Kim’s target is $500 million in cash flow per year (up from $200 million) and only Bally’s, he says, is operating at a loss. (That could change now that Jumer’s is in the mix.) Whether naturally confident or buoyed by the performance of Twin River’s specialty, regional casinos, Kim is upbeat about the future, saying, “It’s amazing how behavior bounces back. I think spending has been a little better [gaming] than for discretionary purchases. People enjoy gambling.” On that we agree.

Midweek room rates on the Las Vegas Strip are cratering. For the week of Nov. 1-7, they are 72% down (-40% on weekends) for an average daily rate of $99. No wonder on whether the current epidemic of Strip violence is keeping visitors away but the bargains to be had are substantial. Convention-dependent MGM Resorts International has plunged 69% midweek and 40% weekends, while Las Vegas Sands is a healthy -14% on weekends but -64% on weekdays. It’s proving difficult for Sheldon Adelson to defend his price point even with Palazzo closed midweek. Worst off is Caesars Entertainment, down 52% on weekends and -75% weekdays, while Wynn Resorts is OK on weekends (-21%) but not midweek (-73%). And to think that the industry used to take conventioneers for granted, even resent them.

Jottings: No CEO of my acquaintance is more heartily despised by his employees than Tilman Fertitta. The following scuttlebutt gives one an idea why. Seems the Golden Nugget (allegedly) sacked 300 dealers. Problem: Aforesaid dealers were entitled to ‘vacation tips.’ Solution: Make up the money by (allegedly) confiscating the tips of working dealers. Nice going, Tilman. Allegedly … This newfangled device should make a casino host’s life easier. It supports 108 different languages (including Zulu) and enables one to converse in a foreign language on the fly … Macao‘s government has assured casino owners that their concessions will be reviewed on time—June 2022. Beijing, meanwhile, is planning to interdict high-roller traffic to Crown Resorts‘ new mega resort in Sydney … $46 million having changed hands between the U.S. government and offshore book 5Dimes, the company can now operate in our country. That’s pretty clement for a corporation accused of money laundering and one that ‘fessed up to taking illegal bets from U.S. punters … Cranky opponents of racinos in Nebraska can now count Gov. Pete Ricketts among their number. He says racinos will increase the amount of problem gambling—a disease he is perfectly willing to export to Iowa next door … A much-ballyhooed IGT lottery contract in Brazil has been scratched like a losing ticket. The contract couldn’t be finalized in time for approval … Guess what? The government of Japan has imposed (another) one-year delay on the casino-approval process. Wake us if this ever turns into a news story.