CASINO

Nevada casino bosses close ranks behind Republicans, worry Asian legislators

TAGs: joe francis, Nevada, sheldon adelson, Steve Wynn

nevada-casino-bosses-republicansMonarch Casino & Resort Inc, which runs the Atlantis Casino Resort Spa in Reno, Nevada, saw net revenue grow 3.9% to $34.6m in Q1 2012. Operations income was up 7.4%, but adjusted EBITDA was essentially flat and hotel revenue was off 12.7% due to the cancellation of a significant convention.

A different significant get-together will go ahead as planned next Friday at Sheldon Adelson’s Venetian hotel in Vegas. Politico reported that Adelson is hosting a fundraiser at the Venetian on April 27th to benefit House Speaker John Boehner. Adelson’s family spent $15m on long-shot candidate Newt Gingrich for most of the Republican primary campaign, but now that Mitt Romney is seen as inevitable, Adelson is throwing his support behind the overall Republican cause. Recent disclosure filings indicate that Adelson has already given $5m to the Congressional Leadership Fund, a Boehner-related super PAC.

Helping Adelson’s ‘bucks for Boehner’ effort will be the American Gaming Association and Wynn Resorts honcho Steve Wynn. Mirroring the pattern of the Republican primary campaign, Wynn and Adelson used to openly snipe at each other via the press, but have since found common cause in their (a) love of Macau and (b) dislike of President Obama.

Another of Wynn’s mortal enemies is Joe ‘Girls Gone Wild’ Francis. Wynn has been waging a five-year war with the softcore porn purveyor over an unpaid $2m casino marker. The tone of the legal tilt turned sufficiently gangsta for both parties to file defamation suits. (Wynn won his in February; Francis’ suit is still pending). To collect on the $2m judgment he got from the Nevada Supreme Court in October, Wynn filed papers this week to garnish assets belonging to Francis, his lawyer David Houston and several of Francis’ companies. Vegas Inc reports that Wynn’s filings appear designed to block Francis from selling or transferring assets until Wynn gets paid. A hearing has been set for next week on Wynn’s bid for a preliminary injunction against Francis.

COULD LEGAL SHENANIGANS JEOPARDIZE ASIAN PROSPECTS?
High profile lawsuits are another thing Wynn and Adelson have in common. Both are currently embroiled in legal tussles involving their Asian operations; Wynn is battling former largest shareholder Kazuo Okada while Adelson is tussling with former Sands China exec Steve Jacobs. Both cases have attracted the attention of US federal agencies regarding possible violations of the Foreign Corrupt Practices Act. It could be argued that Adelson is less responsible for initiating his legal battle than is Steve Wynn, but that may not matter in the long run.

When Singapore opened up its casino market, it chose to award just two operating licenses. Singapore’s highly successful model is viewed as a template by the multiple Asian markets that are considering casino license applications and/or working on legislation to open up their markets. In other words, the brides (and their massive dowries) are few, but the suitors are many. Assuming the competing bids all contain relatively similar numbers, could Asian governments base their final decisions in part on whether they prefer to deal with American firebrand CEOs or their more demure Asian counterparts?

As Matthew Ossolinski, chairman of an emerging markets fund that invests in casino and gambling operations, recently told Reuters: “Since entering Macau, all three Las Vegas-based operators have had international headlines that have caused humiliation and ‘loss of face’ for their Chinese partners and government officials. Some government officials in Asia are now wondering: is it worth it?” Of course, there’s no guarantee that any of this negative publicity will adversely affect the Nevada companies’ Asian prospects, but if it did, it would be an ironic turnaround from the days when US regulators would scold their casino licensees over the ‘unsuitability’ of their Asian partners.

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