Inside Asian Gaming

INSIDE ASIAN GAMING | June 2011 94 Briefs International Briefs Mouse to mouse inquiries lead to gambling bust Abar in theUnited States has been reportedby police for allowing gambling on mouse races. Scott Beach, aged 49, ran the rodent derbies at the Bucktail Lodge in Danville, Iowa—a town of about 900 people—over the course of two years before being cited by the Des Moines County sheriff. The sheriff’s office confirmed that Mr Beach and his wife Jan were reported for knowingly permitting criminal activity on licensed premises. Mr Beach said police told him ignorance of the law was no excuse. Bar patrons pick a mouse for a dollar. The animals run on an eight-foot long (2.4 meter) flat track, with each mouse racing in its own lane. Whoever picks the winning mouse gets the pay-out. Asked if he needed to put cheese at the end of the run to tempt the mice forward, Mr Beach said, “No, they’re in their cages all day. They’re ready to run.” He added he plays racing music for the mice, including ‘Wipe Out,’‘Rawhide,’ and George Jones’‘The Race is On’. Station narrows first quarter loss Station Casinos has reported a smaller first-quarter loss than a year earlier as revenues generated at the company’s 18 local casinos remained stable. Net revenues for the quarter ended 31st March were US$247.7 million, down 0.6% from$249.3million for the same period last year. In the first quarter, the gaming company lost $11.8 million compared with $53.5 million last year. StationCasinos, whichfiled for bankruptcy protection in July 2009 owing almost US$6 billion, won court approval of its restructuring plan in August. The company expects to emerge from bankruptcy in the second quarter of 2011. Chairman Frank Fertitta III and his brother Vice Chairman Lorenzo Fertitta are leading the restructured company with an expected debt of $2 billion. According to Bloomberg News , at least US$1.7 billion of the company’s debt was the result of a leveraged buyout in November 2007 by Fertitta Colony Partners, which took the casino operator private. Station Casinos, founded in 1976, employs 13,000 people. US racetrack casino revenues up nearly 6% Total revenue for US racetrack casinos rose 5.9% in 2010, compared with 2009. That’s a growth rate more than six times higher than the general casino market in the US. The latter managed a lacklustre 0.9% year on year growth in revenues in 2010, according to figures compiled by the American Gaming Association (AGA). The 2010 racetrack casino revenue figure, US$6.74 billion, was up from $6.38 billion in 2009. The number represents the amount of money that casinos retained fromgambling on slot machines or table games. The report, released annually by the AGA, said that the figure was compiled from 45 racetrack casinos operating in 12 states. The figure was bolstered by the opening of new racetrack casinos in 2010 in Florida, where gambling revenue rose 51.9% compared with 2009. Growth was also robust in Pennsylvania, where table games were legalised in 2010, with total revenue at racetrack casinos in the state growing by 26.4%. Racetrack casinos provide hundreds of millions of dollars in subsidies annually to purses and racetrack operators. Recent reports conducted by the racing industry have indicated that approximately one-third of all purses distributed in the US are provided by gambling subsidies. Overall, total gambling revenues at casinos in the US, including riverboat casinos and Native American casinos, increased 0.9% in 2010 compared with 2009, rising from US$34.28 billion to US$34.60 billion, according to the AGA report. The increase was the first in three years for the casinogambling industry.Total casinogambling revenue peaked in 2007 at US$37.52 billion, just prior to the recession. MGM China IPO on target to raise US$1.5 billion MGM China Holdings will fetch a maximum HK$11.66 billion (US$1.5 billion) in its Hong Kong listing amid robust growth in Macau gaming revenue. It is the fourth largest initial public offering of a gambling concern on record, and the fourth biggest new listing on the Hong Kong stock exchange this year, according to data from Dealogic. The shares were priced at HK$15.34 per share, the top end of the initial price range of HK$12.36 to HK$15.34 per share. Brokers said the offer was well received by the market. Philip Securities reported that HK$500 million worth of margin investment was made through the brokerage firm. Applications exceeded the shares on offer by 19 times. “This reflects the market’s reaction to the stellar earnings reports by Macau’s casinos and the strong growth momentum in gaming revenues,” Philip Mok, a research analyst at Philips Securities told the South China Morning Post . But Mr Mok cautioned investors to watch price corrections in the near term, since the offer price had already absorbed these upside factors. Ng Huei-suen, a gaming sector research analyst at CLSA, said gaming revenue in Macau grew 58% year-on-year last year, though that was expected to slow to about 35% this year. Fat Cat—MGM China listing at upper end of valuation