… and if you look closely you can see Venetian Macao executives loyal to Brad Stone being led off to suffocate in the piombi or drown in the pozzi. OK, so I totally made that last part up; too many hearings of Ponchielli‘s La Gioconda will have that effect.
Kudos to Mark Brandenburg, the managing partner of the Golden Gate. His frequent on-site presence and accessibility to guests really brightened the experience of some recent Vegas visitors. They’d had multiple bad experiences at Binion’s Gambling Hall and the Four Queens. (So much for the new service ethic that Terry Caudill supposedly brought when he purchased those Downtown institutions.) By contrast, their stay at the Gate was distinguished by good customer service, and by Brandenburg’s gracious and good-humored interventions on their behalf.
They also give the Gate praise for its ginormous Cobb salad — haven’t tried it myself, but maybe I should — among other gustatory pleasures. (Could it be bigger than the Peppermill‘s banana split? That thing’s the size of Palazzo.) There was less praise for other Downtown casino restaurants, including one that served what is described as shoe leather masquerading as fish.
Back when I profiled it for Casino Executive Magazine (R.I.P.), the Golden Gate was by far the most charming of the Downtown casinos. I’m glad to hear that, in this age of mega- and meta-, the “small is beautiful” mindset is still paying dividends. If you want to see “old” Vegas in the truest and best sense of the term, it’s the place to go.
Desperation has well and truly hit the fan at MGM Mirage. The company’s Strip casinos may not be priced to move … but it’s said to be quite a different story where MGM Grand Detroit and Beau Rivage are concerned. (A Bloomberg report implies that Gold Strike in Tunica may be on the table, too.)
How desperate? We’re talking about sacrificing $231 million in cash flow (in a down year) to keep CityCenter alive. Outside of Vegas, all the company would retain would be “halfsies” of Borgata, MGM Grand Macau and the Grand Victoria riverboat in Elgin, Il. We’d by definition be talking about considerably increasing MGM’s Vegas exposure, especially since CityCenter would — one hopes — be mostly open for business by the time these potential sales cleared the regulatory process.
Strategically, it stinks. MGM would be putting nearly every chip it has on the Strip. At a time when Continue reading
It may be tempting fate to mention this, but online voters like Mandalay Bay best among Strip casinos … or, at bare minimum, dislike it the least. Voters in the Steve Friess "Stripper Poll" on which casino most ought to be imploded have cast nary a ballot against the big place with the Komodo Dragon (seen giving rival casinos a Bronx cheer). As for the winners/losers of this ignominious race, Tropicana Las Vegas still holds the lead but only 16 votes separate its first-place status from the fourth-place spot held by Imperial Palace. "Impotent Palace," look to thy laurels!
Baseball season: Six months of alternating paradise and torment — paid out in 162 increments — begin today. This Los Angeles Angels fan is at best guardedly optimistic, seeing how the team continues to accrue one-dimensional sluggers, tubby Bobby Abreu being the latest specimen. Also, with our three top-shelf pitchers on the … well, on the shelf for time being, the starting rotation is the weakest it's been since 2003.
Now with two of the best Angels of recent memory, Garret Anderson and Casey Kotchman, playing for the Atlanta Braves, I'm actually going to have to start thinking positive thoughts about the Braves, if not of their tiresome manager, Bobby Cox, whose incessant petulance wore out its welcome, oh, around 1991.
Details of Lakes Entertainment‘s just-under-the-wire entry into the Kansas casino derby are beginning to emerge — and it looks a bit half-assed. Particularly non-confidence-inspiring was the admission, “We’re going to go find the cash.” If somebody as flush as Phil Ruffin can’t scare up $175 million, what makes Lakes confident it can score $260 million? Demote this bid from “contender” to “also-ran” status.
Another Kansas applicant also is moving aggressively elsewhere. Cordish Co. is looking to snap up three tracks owned by bankrupt Magna Entertainment. Racino conversion, though is not on the agenda, according to Cordish.
No fools. It looks as though Penn National has sworn off the Strip and small wonder. If execs at Harrah’s Entertainment or MGM Mirage say they want to deal but insist on 10X-12X cash flow as their asking price, they’re not going to find takers. I presume that their rationale — and it’s hardly without merit — is that if business returns to the levels it enjoyed four years ago those multiples will go down.
Whether that argument will fall upon receptive ears seems unlikely. But look on the bright side: You could pay 12 times EBITDA for the Tropicana Las Vegas and it would still only cost you $54 million.
Five bucks a f**k? Sure prostitution is legal in 10 counties of Nevada, a state whose economy is built on the perception of an anything-goes atmosphere. But tax bordellos by the lay? Horrors!
Or, in lieu of "Atlantic City Death Watch VII," maybe "Colony Death Watch." Scarcely had S&G dubbed Colony Capital's East Coast casino portfolio "Colony Crapital" than came affirmation in the form of the latest set of numbers from the Boardwalk.
First, the good news. Everyone in Atlantic City reported a profitable operating margin last year as well as a gross operating profit. As the Press of Atlantic City explains, "Net income, however, is not considered as important as gross operating profit, which is seen as the best way to measure a casino’s financial strength."
For instance, Harrah's Entertainment had the two best operating margins in the city (at Caesars A.C. and Harrah's Marina) and four of the top five. In gross operating profit, the Harrah's-owned quartet held the #2-3 and #6 spots, bested only by Borgata (#1, of course) and Trump Taj Mahal. However, thanks to some accounting jiggery-pokery back at corporate HQ, all four posted year-end losses — some of them gargantuan, like the -$355 million charged against Caesars. Only Boyd Gaming's Borgata reported a profitable 2008. In terms of revenue, it was so far ahead of everybody else — by $280 million — it's not even funny.
For Harrah's Marina, the good news was triplefold. Not only did it have the smallest diminution of gross operating profit (-1%), it was also the sole casino to record an increase — 8.5% — in revenue.
Harrah's operational skill aside, UNLV's David Schwartz found another silver lining. To wit, "I’m surprised that gross gaming revenues fell by only 7.1%. For all of the belly-aching about the partial smoking ban and competition from Pennsylvania, Atlantic City’s gaming win actually declined less than Nevada’s, which shrank by about 10%. People are still willing to come to Atlantic City; they are just gambling less." [Emphasis added.]
Now for the bad news. The two lepers in the A.C. colony are — you guessed it — Resorts Atlantic City and the Hilton. Those two Colony Capital casinos posted extraordinarily dismal numbers, even by last year's low standards. Their operating profit margins were less than 2%, against a market average of 21%, and their gross operating profit was $6.3 million … combined. In a year when the average Atlantic City casino saw a gross operating profits fall 25%, Colony's duo crash-dove -88% and -89%, respectively.
Compare this to Trump Marina. Even in a semi-orphaned state, as its sale dragged on (and on), the future Margaritaville garnered superior operating profit margin — 7.5% — and a far bigger operating profit on the smallest revenue base in the market. It reported gross operating profit of $15 million on revenues of $195 million. Somebody's doing something right and it's not Colony's Atlantic City braintrust.
Does Colony know how to pick 'em or what? And is MGM Mirage sure it wants to get into bed with these guys? They're starting to make James Packer look like a sagacious casino mogul. As for the Hilton, which used to be Steve Wynn's Atlantic City Golden Nugget, suffice to say it's seen better days.
Credit-default swaps, some of those financial instruments that have played hob with the U.S. economy, are making a cameo appearance in the tortured saga of Station Casinos. If you insured Station's debt, that insurance is worth more than the paper your CDS is printed upon — but not by much.
Congratulations, MGM Mirage. Your probable rescuer is a bottom-feeder who's preparing to root around amidst the dregs of the banking industry. However, with CityCenter as much as $3.8 billion shy of the finish line, MGM isn't in a position be picky about going into business with the K-Mart of casino owners.
Rivers Casino, the former Majestic Star, has some CityCenter-style construction problems. This project has been so vexed and hexed that nothing comes as a surprise anymore.
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Interesting business model. Halfway around the globe, Melco Crown Entertainment's got a lot riding on its City of Dreams megaresort. To bring back the whales, it's essentially promising that they can welsh on their markers with impunity. Or, as the company puts it, "Aggressive enforcement actions against a customer [may] unduly alienate the customer and cause the customer to cease playing at our casinos." And, gosh knows, nobody wants to alienate a deadbeat debtor.
Nearly lost amidst a flurry of news stories about Las Vegas Sands hoping to jump-start construction on its stalled Cotai Strip™ (with the help of new equity partners) was this snippet from Sands' president of Asian affairs, Stephen Weaver. Rents at the Marina Bay Sands shopping mall, still under construction in Singapore, are being “pulled down to adjust to the market.”
Lower projected rents? Just one more reason to curb the irrational exuberance with which some Wall Street analysts view this $5.4 billion project.
Under the radar: Remember how Columbia Sussex told the New Jersey Casino Control Commission, in effect, "put it on our tab," when hit with a $750,000 fine? ColSux's original plan was to just have the NJCCC skim the 750 large off the top of whatever it got from selling the Tropicana Atlantic City.
However, the NJCCC informs me that ColSux affiliate Adamar settled up with the state a ways back. Bravo to them. Besides, if Carl Icahn wins the Trop with a credit bid, the casino will change hands but no money will. So much for the windfall everyone was anticipating a year ago.
That’s one of the implications of Colony Capital‘s potential cash infusion into CityCenter. Since Colony owns 3/4 of Station Casinos and might find itself with a big piece of CityCenter, it’s an utter certainty that it wouldn’t go along with the notion of Station building a fugly CityCenter knockoff on the other side of I-15. Of course, the Fertitta Bros. still control the Station board, so they could try and drag Colony down the Viva highway to hell if they want to force the issue.
But what does it say about CityCenter if Colony wants to buy in? The fund’s track record in casino investing has been predominantly dreadful of late. A philosophy of acquiring “non-performing loans, distressed assets … out-of-favor sectors,” hasn’t worked out so well. For instance, the REIT got a fire-sale price ($140 million) on Resorts Atlantic City, then saddled the dowager with a mortgage 160% excess of her market value.
When Resorts’ sclerotic revenues caught up with Colony, it simply opted out of its “house payments.” This nearly brought us the edifying spectacle of seeing a casino get repossessed by the bank. Between the venerable Resorts and the comparably ancient and non-performing Atlantic City Hilton, the fund’s Boardwalk portfolio risks being dubbed “Colony Crapital.”
Not only did Colony overpay (or, more accurately, over-borrow) for Station Casinos, it got further hornswoggled in the deal. Despite holding 76% of the equity, it only controls 40% of the board. Similarly, it let Goldman Sachs buy into the Las Vegas Hilton by dint of surrendering ultimate authority over capex decisions to Goldman.
It seems baffling from a common-sense standpoint that Colony could purchase a big stake in City Center, offer $850 million for the Tropicana Atlantic City (as it did last spring) or start a new fund to buy more yet distressed assets (as it’s doing) when most of its casino properties are sucking wind. Shouldn’t it be salvaging what it’s already got?
Ethically, yes; realistically, no. For a fund like Colony, that’d be throwing good money after bad. (“Wanna buy a piece of this fund to bail out Resorts A.C.? No? How about putting some more into Station? Why not?!?”) The way it’s compartmentalized, Colony can keep buying shiny new silos, no matter how many of its existing silos are crumbling into barkdust, so long as there are takers for its fund offerings. Leave the bad investments to their fate and better luck next time.
One might be pardoned for thinking Colony couldn’t run a lemonade stand profitably, as the company’s gaming-sector strategy seems to consist of throwing money against a wall over and over again until some of it comes back. One of the questions raised by the CityCenter discussions is: How much control would Colony get in return for its money? Given that MGM Mirage is setting aside shutdown capital for the project, Colony appears to hold the leverage. It’d be smart to leave MGM in the driver’s seat — and besides, Colony is no stranger to dealing itself into a position of weakness.
Then again, Colony may well be a stalking horse for Saudi mogul Prince Alwaleed Bin Talal, one of its business partners. He’s got deep pockets and grandiose plans … just the sort of fellow who might fancy being the monarch of CityCenter.
Speaking of the Fertitta Bros. … the president of their pride and joy, the UFC, a charming fellow by the name of Dana White is making headlines and not in a particularly good way.
Those [expletive] UFC [expletive] board meetings [expletive] must be [expletive] really something [expletive] else, [expletive]. Wouldn’t you [expletive] want to [expletive] be a [expletive] fly on the [expletive] [expletive] [expletive] wall, mother[expletive]?
Should Colony take a stake in CityCenter — thereby dooming Viva — perhaps the Fertittas can send Mr. White to Colony HQ as their good-will ambassador.
Perhaps it was with dry irony that the Las Vegas Review-Journal's latest Station Casinos story's subhead read, "Company blames economy, poached customers." And by whom might those customers have been poached? By Station Casinos itself! The company's imperial overreach has reduced it to gnawing on its own femur, as each new Station property cannibalizes business from somewhere else in the Fertitta empire.
Bad as the 2008 financials were, 2009 is going to be that much worse once the encroachment of M Resort begins to be felt. Last year, Station's casino revenues fell by 11% and ADRs were down comparably. A 14% slippage in cash flow from 2007 meant that a deal valued at a rose-colored 9.7X EBIDTA is now effectively over 11X cash flow. Even had the Fertitta Brothers not insisted upon carting home a half-billion dollars as part of the buyout, its valuation would still have been quite over-optimistic.
(Even in a boom year, Station's proposal to dilute Aliante Station's revenues with a nearby "Losee Station" would be inexplicable. Given the company's current financial performance, it's an idea quite a few fries short of a Happy Meal.)
Elsewhere in the casinosphere, the closest thing to good news was Planet Hollywood's disclosure that it shaved 40% off of last year's losses, thanks to a nearly 8% revenue increase. More alarmingly, the Las Vegas Hilton — seemingly the one casino-hotel Colony Capital couldn't ruin — has swung from a profit to a loss.
It's a business miracle! Losses at soon-to-be-cleft Herbst Gaming widened by 60%. Most of that was driven by a -33% downward spiral in slot-route revenues. By contrast, the ouster of sundry Herbsts in favor of CEO Ferenc Szony appears to have given the company's 15 casinos a boost because, as dowdy as some of those places are, their revenue actually grew 1% last year.
For most companies that might be unremarkable; for Herbst it's a miracle. It also puts paid to the Herbsts' face-saving insinuation that, by keeping the slot routes and parting with the casinos, the family was hanging onto the real goodies. I can't even remember the last time I went into a Terrible's convenience store and saw somebody playing the slots.
Humpty Dumpty had a great fall. The Nevada state budget is a two-legged stool, balanced upon gaming and sales taxes. That stool is getting wobblier by the day. Unfortunately, if the Lege has any solutions, it's keeping them to itself.
Europoseur:
Only found on or near the Strip, sometimes impersonated by French Canadians (see Soleil, Cirque du). Occasionally demand to be addressed by their initials only, usually smoke cigarettes and are invariably able to generate fawning press coverage. Are known to manifest themselves in forms male (Christian Audigier), female (N[icole] D[urr] of Raw Talent Live infamy) and extraterrestrial (Guy Laliberté).
It's a race to Chapter 11 now, with Riviera Holdings in the lead. Its glandular-themed rival down the street is opting out of an interest payment and drawing down the last of its credit, never a promising sign. However, Riviera is forcing a confrontation with Wachovia Bank. Given a choice between hoarding cash on hand and making a $4 million interest payment, Riviera execs chose Door #1. That comes atop some scarifying 4Q08 numbers that included a $13 million loss, plus cash-flow declines of 64% on the Strip and 42% in Black Hawk, Colo. (Those newly enacted rule relaxations in Colorado can't come soon enough.)
Downward pressure on ADRs (not to mention 84% occupancy) and diminished convention trade (-28%) were blamed for the decision to conserve dollars. While the Riv recorded almost as much entertainment revenue as the year before, 27% of that took the form of comps to high-value players and thus came right back off the ledger.
The Riviera's appeal is not likely to be enhanced by the announcement it is renting out space to that bane of Strip visitors — a timeshare company. "We have implemented and will continue to implement promotions to attract competing hotel customers to our property to enjoy our amenities," Riviera adds. Just don't order the powdered eggs, OK?
Station Casinos, meanwhile, closes the book on a poor-to-awful 2008. Cash flow was below $100 million for the fourth quarter, further underlining how overvalued the company's LBO price was.
No more sports betting … at least not until football season at Bally's. What the hell. You can't bet on a Boston Celtics game there anyway.
Seen yesterday at the Luxor ticket booth: A video message promising 35% off Believe tickets if you stay at the King Tut place between Tuesday and Thursday (inclusive).
Heck, just last week Luxor trotted out one of the most “george” package deals I’ve ever come across: For a two-night/$420 stay, you’d get: “all you can eat at the buffet” (LVA readers don’t like it and neither did I), plus pairs of comped tickets to the Titanic and “Bodies” exhibitions (S&G recommends the former, won’t go near the latter — creeptastic); free admission to both LAX and CatHouse; Nurture spa day passes; and, yes, a pair of freebie seats for Believe.
At a very conservative estimate, that’s $431 in comps for a $420 room (not including hotel taxes are sundry add-ons). Yes, Vegas is giving away the store.
And yet … not so desperate that you can score free tix for Fantasy. No, you are condemned to see Believe. If it wasn’t clear right after opening night, it’s painfully evident now that if this vanity production were any more of a dog it’d have mange. Forget a 10-year contract. This turkey will be lucky to eke out 10 months.
What’s more, you can enter a drawing to win Criss Angel‘s automobile (a Corvette, I seem to recall). If that car is anything like Angel’s show, as soon as you get the keys and registration, it’ll have to go into the shop for weeks of vague “fixations.”
"The point of convergence is the obligatory version of Louis Armstrong singing 'What A Wonderful World,' apparently required for an impressionist to obtain a Clark County business license." — Mike Weatherford on the common denominator between Danny F. Gans, Terry Fator and "Downtown" Gordie Brown. I was offered free Brown tickets but couldn't pass up the chance to rearrange my sock hamper or maybe even watch some paint dry (literally … the drywall in my bathroom had to be redone and resurfaced after the roof sprang multiple leaks).
Like a hot potato, the Tropicana Las Vegas continues to bounce from Columbia Sussex to Tropicana Entertainment and now maybe into the hands of Alex Yemenidjian. (This management-contract arrangement looks more like laying the groundwork for a sale … if so, thanks for taking S&G‘s advice, guys. It’s worth what you pay for it.)
A top price of $380 million can be viewed either as a bargain — $11 million an acre, a long way down from the berzerk price paid by ColSux two-plus years ago — or a boondoggle, seeing as even $380 mil represents an 84X cash-flow multiple. Somebody’s got a job ahead of them.
Unfortunately, TropEnt CEO Scott Butera hasn’t had his eye on the ball. Now, there wasn’t anything he could do to keep the Titanic and Bodies exhibits from jumping ship to Luxor. But he pulled the plug on Folies Bergere and the Comedy Stop. Then, having given magician Dirk Arthur the boot, Butera’s minions had to reverse field and grant the illusionist a reprieve through September. (So if you go to the Trop in April, the only entertainment offering will be an afternoon magic show. That’s it.)
Just another day at the Trop.
As of Sunday, the Trop will have no (as in “zero”) marquee attractions to tout. So it’s an understatement to say that an agreement “in principle” with comedian Bobby Slayton doesn’t come a day too soon and a formal contract needs to be inked yesterday.
When Nero played an as-yet-uninvented instrument, Rome burned. Whilst Butera fiddles, the Trop merely continues fade. Unless TropEnt’s song and dance about repositioning the Trop is just a soft-shoe act, playing for time until the whole problem can be deposited in Yemenidjian’s lap.
Ever since he took the reins at TropEnt, Butera has been fixated upon getting the Tropicana Atlantic City back (which he should) and, secondarily, with regaining Casino Aztar in Indiana (which he did). But the LV Trop has clearly been a low priorty and now he’s washing his hands of it. Which means the real problem won’t be Yemenidjian’s but that of Trop employees and their equally neglected customers.
Patience, thy name is a Harrah’s Entertainment bondholder. A surprisingly large number of these long-suffering souls are willing to wait just shy of a decade to redeem their distressed Harrah’s debt. They’re better men than I.
This book looks like a must-have. And, no, Huntington Press didn’t publish it. But we do have a nifty new edition of Whale Hunt in the Desert, thank you for asking.
Did somebody build the inaptly named Lucky Club (above) over an Indian burial ground? A deprivation of access is but the latest indignity suffered by this North Las Vegas grind joint. While it was still the Speedway Casino, it was ravaged by fire. Years earlier, it was the Cheyenne, most famous for having its bookeeping described as “smoke and mirrors” by then-Nevada Gaming Control Board Chairman Bill Bible. That rumpus — and a few others like it — would dog casino speculator Shawn Scott for the rest of his spotty career. Last we heard, Scott had hunkered down in the Virgin Islands.
Better fortune was in store for the long-on-the-market Ritz-Carlton Lake Las Vegas, which couldn’t find any takers not so long ago. I’m guessing “undisclosed price” is code for “fire sale.”
(Update: It sold for $98 million.)
At least I’m not alone in thinking that Las Vegas Sands is headed over the brink. So does John L. Smith who has more bad news for Sheldon Adelson.
Need to raise awareness of your bookmaking service? Hire a gambling addict as your pitchman! The surprise isn’t that this, er, novel marketing initiative was ashcanned but that it got as far as it did. Earth to Better Bet, Earth to Better Bet …
Earth to Wynn … Weather forecasters have been predicting high Thursday gusts of wind all week long. But Wynn Resorts must not have paid its cable TV bill because it sent window-washers up Encore anyway. Not surprisingly, something went wrong and they had to be rescued. Now that everybody in Vegas is on a curtain-wall craze, expect crises like these to multiply exponentially.
Going out on a limb, the Las Vegas Sun says that Sens. John Ensign and Harry Reid were doing the right thing … now that a consensus has formed and the story has faded, making it safe to take a stand.
Wendover: Casinos, yes; mental health care … not so much.
If you’re going to lose your marbles in Nevada (some would say I already have), don’t do it in Wendover. It’s still OK to lose money there, though. Wendover Will approved this message.
On second thought, you might not want to bring your money here, either. At least not if you use debit cards. Where do I sign the petition to abolish the Nevada Legislature? They don’t need any stinking due process, do they?
While building the Stratosphere, maverick casino owner Bob Stupak ran out of money, leaving the tower only partially erect. Wags were quick to dub the stymied Stratosphere “Stupak's Stump.”
Stupak, of course, eventually finished the tower — although it proved his undoing in the gambling industry. I was reminded of this while pondering MGM Mirage's predicament with its forcibly foreshortened Harmon condo-hotel. (If it had gambling, we'd call it a “failsino.”)
At a truncated 25 stories (or roughly half its intended height), The Harmon cries out for a nickname but so far nobody has risen to the occasion. That's where you, dear readers, come in. How does “Lanni's Lump” grab you? Or “Murren's Midget”? Perhaps even “Baldwin's Bump”? “Perini's Plinth,” anyone?
Better still … suggest your own nickname for the mountain that was made into a molehill. Let the alliteration commence!
I'm deeply imbedded in other projects today. In the meantime, by way of In Business Las Vegas and GamingFloor.com (source of yesterday's Harrah's Entertainment time warp, too) here's the answer to the question, "How many casino failures can you pack into nine minutes?" Watch it and weep.
It’s all but certain that the unenviable steeplechase to be the first major gaming company to declare bankruptcy in 2009 will be won by … Station Casinos!* (On Tax Day, no less.) None of the company’s three rescue scenarios does not involve some form of bankruptcy.
(* — Unless Trump Entertainment Resorts still counts as “major” operator, but I strongly doubt it.)
Potential runner-up MGM Mirage is at least a month behind. Coincidentally or otherwise, mid-May would also mark the point at which the maw of CityCenter devours the $500 million realized in the Treasure Island sale (leaving approximately $600 million in the kitty), should that close on schedule.
Which might be A Good Thing: Another razor-sharp analytical piece from the Las Vegas Sun efficiently lays out the reasons why Chapter 11 is the worst option — except for all the others. Not only does it keep the companies in one piece, it reduces the incentive to cannibalize capex dollars for debt servicing. Also, the prospect of facing regulatory scrutiny is daunting enough to bankers that they’re inclined to keep the status reasonably quo.
Although MGM Mirage has one of the best debt-to-earnings ratios on what I’ll call the Benston-Velotta Scale, short-term debt has pushed it far closer to the brink that Wynn Resorts or Boyd Gaming, both of whose ratios look slightly worse on paper …
But not nearly as bad as the nearly 15:1 debt-to-earnings imbalance under which Las Vegas Sands is crumbling. It really makes you wonder what the Sands-loving analysts at Sanford Bernstein have been putting in their coffee. Running a close second at 13:1 is bankruptcy-bound Station, the victim of cash-flow projections that were extraordinarily far from the mark.
Taxing problems: More numbers are available on the proposed cigarette and liquor tax hikes. They’re ugly but I did get a chuckle from the R.J. Reynolds lobbyist who floated the solicitous argument that tobacco taxes are bad because they’re regressive. Nice try. (Altruism is not Big Tobacco’s strong suit.)
I’ve also shamelessly swiped these market-cap comparisons, which Hugh Jackson posted today:
Barrick Gold: $27.5 billion
Newmont Mining: $18.72 billion
Wynn Resorts: $2.37 billion
Las Vegas Sands: $1.46 billion
MGM Mirage: $959 million
That’s $46.2 billion for just two mining firms vs. less than $5 billion for three of the most significant casino companies. Which of these industries is in the cross hairs for an imminent Nevada tax increase? I’ll give you a hint: The answer does not contain the word “mining.”
Wynn(ing) Scenario: No matter what he says, people love to speculate that Steve Wynn’s going to use his new stock offering to buy another casino. I’m not saying he won’t … but $175 million won’t get him far, even in this market. Unless he’s got a sudden hankering for the Tropicana or Riviera, that is.
