{"id":17044,"date":"2015-10-22T11:18:15","date_gmt":"2015-10-22T19:18:15","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/?p=17044"},"modified":"2019-01-11T09:11:23","modified_gmt":"2019-01-11T17:11:23","slug":"adelson-crashes-mgms-party-more-trouble-for-dfs","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/adelson-crashes-mgms-party-more-trouble-for-dfs\/","title":{"rendered":"Adelson crashes MGM’s party; More trouble for DFS"},"content":{"rendered":"

Sheldon Adelson<\/strong> has a genius for sucking the air out of whatever room he enters. After MGM Resorts International<\/strong> laid the groundwork for a casino debate in Georgia<\/strong>, offering to invest $1 \"Sheldon_Adelson<\/a>billion in an Atlanta<\/strong> pleasure palace, Adelson has come along and upped the ante to $2 billion. That’ll make an impression. Adelson also has Peachtree State allies, like Newt Gingrich<\/strong> and former Las Vegas Sands<\/strong> COO Michael Leven<\/strong>, who has returned to the Georgia Aquarium<\/strong>, from which Adelson had plucked him. \u201cHe\u2019s controversial for sure. He\u2019s dynamic and aggressive. But he makes enormous contributions to every community he\u2019s been in,” Leven told the Atlanta Journal-Constitution<\/em>.\u00a0\u201cHe\u2019s never going to get left behind. He makes sure he knows what\u2019s going on and where it\u2019s going. He knows every detail,” added political consultant Randy Evans<\/strong>.<\/p>\n

Penn National Gaming<\/strong> and Boyd Gaming<\/strong> have been reported as having interest in Georgia, but nobody’s made the splash that Adelson has … especially when he had his limousine parked in space normally reserved for Gov. Nathan \"nathan_deal\"<\/a>Deal<\/strong>‘s staff, irking the governor, who didn’t appreciate Adelson’s march through Georgia while he, Deal, was drumming up trade in Europe. So annoyed was Deal than he’s gone from being passively against gambling to actively opposing it. (Deal and Adelson have never been particularly close.) Whoops.<\/p>\n

Adelson already made headlines with\u00a0his high-profile evacuation of Florida<\/strong> with the explicit reassignment of that lobbying effort to Georgia. Sheldon had a little difficulty staying on message with Speaker of the House David Ralston<\/strong>, bending Ralston’s ear energetically on the subject of Iranian nuclear weapons. (Perhaps he thought he was talking to pundit Jon Ralston<\/strong> instead.)<\/p>\n

Despite his proclamations of independence from big money donors, Donald Trump<\/strong> seems miffed by Adelson’s all-but-explicit support of Sen. Marco Rubio<\/strong> (R), sulking that Adelson “can mold him into \"Sheldon\"<\/a>his perfect little puppet.\u201d Too bad for Trump that the Sands CEO only has ears for the counsel of Mitt Romney<\/strong>. In addition to donating to Rubio, Adelson’s hedged his bet via contributions with Sen. Lindsey Graham<\/strong> (R), who does Adelson’s bidding on Capitol Hill<\/strong>. As for Georgia, it remains to be seen whether Adelson’s high-visibility brandishing\u00a0of his checkbook will outweigh the lese-majeste<\/em> that has alienated Deal.<\/p>\n

Back at Sands HQ, it was time to roll out the 3Q15 numbers, which Deutsche Bank<\/strong> analyst Carlo Santarelli<\/strong> described as “better than expected,” calling Sands “the safer play on the potential Macau<\/strong> \"Venetian-Macao\"<\/a>recovery given its growing dividend and fortified balance sheet,” but the one most likely to be impacted by new competition. Santarelli credited “continued cost mitigation efforts in Macau [on staffing, marketing and comps] and surprising upside in Singapore<\/strong>” ($751 million) for the positive outcome. Opening of the The Parisian<\/strong> has been pushed back. J.P. Morgan<\/strong> analyst Joseph Greff<\/strong> counseled investors to expect an early 2017 debut.<\/p>\n

On the downside, mass-market table and slot play in Macao were down 23%, and VIP play volume fell a horrid 48%. On the upside, \"palazzo-pic\"<\/a>room revenues in Las Vegas<\/strong> spiked 23%. Macao room rates, by contrast, were down 16% — and nobody is as exposed in that market as Adelson — but non-Chinese tourism provided a pleasant surprise in the Marina Bay Sands<\/strong> revenues. Greff describes Venetian<\/strong> and Palazzo<\/strong> cash flow as “very respectable” even though it computes to a 12% return on investment … or is that as good as one can expect of a Las Vegas Strip<\/strong> megaresort in these times?<\/p>\n

* The federal prosecutor who laid waste to the online-poker industry now has daily fantasy sports in his gunsights.\u00a0Preet Bharara<\/strong> is probing the legality<\/a> of the DraftKings<\/strong>\/FanDuel<\/strong> business model, in a development that should have the DFS industry very worried. The nascent investigation is just the latest in a growing number of probes into the DFS demimonde. Gaming attorney Daniel Wallach<\/strong> went so far as to say, “Because of his past and his reputation, this is probably the most frightening development yet for the industry,” which operates in a gray zone in most states (unlike Kansas<\/strong>, Maryland<\/strong> and New Jersey<\/strong>, which have explicitly legalized it).<\/p>\n

Records of the Fantasy Sports Trade Association<\/strong> have already been subpoenaed<\/a> by a federal prosecutor in Tampa<\/strong>, prompting Amaya<\/strong> site StarsDraft<\/strong> to shutter Florida<\/strong> operations. So far, DFS can at least take comfort in its exemption under the Unlawful Internet Gambling Enforcement Act<\/strong>, which exempted bank transactions involving fantasy sports … although nobody dreamt at the time that DFS would blow up into a multi-billion-dollar industry, on pace to rival private-sector casinos by 2020. As GamblingCompliance<\/strong> Managing Director James Kilsby<\/strong> tells the Wall Street Journal<\/em>, “this fight seems more likely to be about the core legal status of the activity, rather than the movement of money around it.”<\/p>\n

Incidentally, the WSJ<\/em> has assigned Pulitzer Prize<\/strong>-winning investigative reporter Alexandra Berzon<\/strong> to the case and where Berzon goes, trouble follows. DFS operators have good cause to fret.<\/p>\n","protected":false},"excerpt":{"rendered":"

Sheldon Adelson has a genius for sucking the air out of whatever room he enters. After MGM Resorts International laid the groundwork for a casino debate in Georgia, offering to invest $1 billion in an Atlanta pleasure palace, Adelson has … 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":[60,42,14,26,36,152,22,37,45,62,72,11,69,33,25,12,108,9],"tags":[],"_links":{"self":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/17044"}],"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=17044"}],"version-history":[{"count":7,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/17044\/revisions"}],"predecessor-version":[{"id":23255,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/17044\/revisions\/23255"}],"wp:attachment":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/media?parent=17044"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/categories?post=17044"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/tags?post=17044"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}