{"id":11138,"date":"2013-07-12T14:21:28","date_gmt":"2013-07-12T22:21:28","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/?p=11138"},"modified":"2022-10-25T04:23:35","modified_gmt":"2022-10-25T12:23:35","slug":"caesars-you-only-buy-twice-to-russia-with-ho-land-in-distrust","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/caesars-you-only-buy-twice-to-russia-with-ho-land-in-distrust\/","title":{"rendered":"Caesars: You only buy twice; To Russia with Ho; Land in (dis)trust"},"content":{"rendered":"

Do you already own stock in Caesars Entertainment<\/strong>? Congratulations. Thanks to the Nevada Gaming Control Board<\/strong>, you will have an opportunity to pay a second time<\/a> for some of Caesars’ assets. Although it \"\"hopes to raise $1.2 billion from the public offering, Caesars has pledged so much dough against casino projects in\u00a0Cleveland<\/strong> and Baltimore<\/strong>, and possible ones in Ontario<\/strong> and Florida<\/strong>, that the money’s as good as spent already. The spinoff will leave the parent company only $19.6 billion in debt, $500 million having been dumped off onto Caesars Growth Partners<\/strong>. As described earlier in these pages, the latter will own a grab-bag consisting of Caesars Interactive<\/strong>, Horseshoe Baltimore<\/strong> and Planet Hollywood<\/strong>. Growth Partners will skim, er, collect<\/em> management fees from the two casinos. (Getting paid by assets that you own … that’s a mighty neat trick.)<\/p>\n

Caesars stock jumped like a kangaroo<\/a> on the news. But Motley Fool <\/em>analyst\"\"Travis Hoium<\/strong> panned this “dilutive offering<\/a>.” The Street<\/strong>‘s Robert Weinstein<\/strong> also took a wait-and-see attitude, describing Caesars’ balance sheet as emulating “the joy of a seven rolled after establishing your number … Why raise capital to expand into new areas if you can’t produce a profit in your core market?<\/em>” Today, Hoium came back for a second whack, describing CEO Gary Loveman<\/strong>‘s ploy as a “sucker’s bet … a sweetheart for private equity and a stinker for investors<\/em>.” If John Q. Stockholder doesn’t buy into Growth Partners, he’s ceding an even larger stake to Texas Pacific Group<\/strong> and Apollo Management<\/strong>, Hoium argues. He even questions with Caesars Entertainment can survive with Caesars Interactive spun off in this fashion.<\/p>\n

Man on the move<\/strong>. The most ubiquitous figure in gaming this year \"\"is inarguably Lawrence Ho<\/strong>. In addition to making a big move into the Philippines<\/strong>, he’s now committed $630 million<\/a> toward a pair of casinos in Russia<\/strong>. One would be in Vladivostok<\/strong> and the other elsewhere in the Primorye<\/strong>. True, when one thinks of the glitz and romance of casino gambling, “Vladivostok” is not the word that springs to mind. It is, however, but a short drive from the border of China<\/strong>, and a couple of hours’ flight<\/a> from Peking<\/strong> and Tokyo<\/strong>. It’s far closer to Peking than the latter is to Macao<\/strong>. Ho’s Melco Entertainment and affiliates will buy51% license-holder Oriental Regent Ltd<\/strong>. By Vegas standards, the casinos will be small: an aggregate of 210 tables, 1,300 slots and 319 hotel rooms. But you’ve got to start somewhere and, with casino gambling in Japan on indefinite hold, Ho’s made a bold and strategic move, striking deep into gambler-rich territory. S&G<\/em> tips its fedora to him.<\/p>\n

As I was saying<\/strong>, look for tribal gaming to become more aggressive in what’s pejoratively known as “reservation shopping.” Last week, it was the North \"\"Fork Rancheria of Mono Indians<\/strong> gaining an off-reservation foothold in California<\/strong>. This week, we have the Lower Brule Sioux Tribe<\/strong> seeking to move 15 miles off-rez and next to I-90 as it traverses South Dakota<\/strong>. In a (very small) concession to the Crow Creek Sioux Tribe<\/strong>, which operates a casino near the Lower Brule Tribe’s existing one, the Lode Star Casino<\/strong> (above<\/em>) would be closed. So, the Crow Creek get the “convenience customers” while the Lower Brule lap up traffic from the interstate. I don’t see this going through without considerable inter-tribal acrimony.<\/p>\n

\"\"Unlike his California counterpart, Jerry Brown<\/strong>, S.D. Gov. Dennis Daugaard<\/strong> is staying neutral for the moment. However, this may be a very, very rare scenario in which it was not the white man who spoke with the forked tongue. During its land-in-trust applications, the Lower Brule “asserted several times in … related documents during the 1990s that it would use the site for historic tourism purposes and didn\u2019t plan a gambling casino there<\/em>.” It was under a like understanding that then-Gov. Bill Janklow<\/strong> backed the application. According to the Rapid City Journal<\/em>, the Lower Brule left themselves justthismuch wiggle room, though: “The tribe also stated, however, that it would follow federal Indian gaming laws if it did pursue a casin<\/em>o.”\u00a0The casino-owning Shakopee Mdewakanton<\/strong>, over in Minnesota<\/strong>, will put up the money for the $53 million, mixed-Class II\/Class III\u00a0casino, if it gets built … which surely won’t happen without a fight.<\/p>\n","protected":false},"excerpt":{"rendered":"

Do you already own stock in Caesars Entertainment? Congratulations. Thanks to the Nevada Gaming Control Board, you will have an opportunity to pay a second time for some of Caesars’ assets. Although it hopes to raise $1.2 billion from the … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[28,36,7,22,37,94,62,72,71,6,25,20,38],"tags":[],"_links":{"self":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/11138"}],"collection":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/comments?post=11138"}],"version-history":[{"count":3,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/11138\/revisions"}],"predecessor-version":[{"id":31806,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/11138\/revisions\/31806"}],"wp:attachment":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/media?parent=11138"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/categories?post=11138"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/tags?post=11138"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}