Inside Asian Gaming

INSIDE ASIAN GAMING | February 2010 20 MGMMIRAGE has been up and running for more than two years—has more than a passing connection with the decision of financially-straitened MGM MIRAGE to shelve plans for further investment in Atlantic City. Even if the company does sell its Borgata stake, it still owns 120 acres of prime land in the seaside resort, including the plot occupied by The Borgata. If it decides to hold on to that land, it would give MGM MIRAGE the option of re- entering the Atlantic City market later once economic conditions improve or when the political climate in the Garden State is more favourable toward the company. Down by law Ms Ho’s father, Macau’s former gambling monopolist Dr Stanley Ho, has been accused by US Federal authorities in the past of links with organised crime in relation to the operation of VIP gaming rooms in his Macau casinos. That hasn’t prevented regulators in Nevada and Mississippi from previously approving MGM MIRAGE’s Macau partnership. Industry analysts with a more cynical turn of mind think the emergence now of Ms Ho as an issue in MGM MIRAGE’s New Jersey licensing—when MGM Grand Macau outperforming the general Atlantic City market, with revenue falling only 5.9% to US$738.78 million. Bullish Macau By contrast, Macau’s city wide revenues grew by nearly 10% in 2009, despite the effects of global recession, visa restrictions and a squeeze on credit issued to VIP table players in the first half. The Wall Street Journal reports MGM MIRAGE has been offering its stake in Atlantic City’s Borgata to several financial investors and casino companies, including the property’s co-owner, Boyd Gaming. MGM MIRAGE has reportedly been asking US$700 to US$850 million for the stake, but interested buyers feel the business is worth more like US$500 to US$550 million, said the WSJ . Boyd has the right to match any offer made by an outside investor for MGM’s stake in The Borgata. MGM MIRAGE’s gaming licence for The Borgata is due to come up for renewal in June. The New Jersey Casino Control Commission is expected this spring to hold a hearing on Ms Ho’s suitability as a partner for MGMMIRAGE, so the company will probably be keen to resolve any sale before then. Last May, New Jersey’s Division of Gaming Enforcement issued a report to the state’s Gaming Control Commission describing Pansy Ho as an “unsuitable” partner for MGM MIRAGE, according to a filing made by the casino operator to the US Securities & Exchange Commission. The Borgata Pansy Ho