Sports Betting To The Rescue In Vegas!

The NFL season is under way and always brings dollars into the casinos in Las Vegas.  This year is no different.  As expected sportsbooks were packed on Sunday, but it seems as if people were betting a little more than in recent history.

“We might have found the only thing that is recession proof and that’s the NFL,” said Jay Kornegay. Hilton Sports Book Executive Director Jay Kornegay admits he was surprised to see a packed house.

“I was very surprised this morning when I got in here at 9 o’ clock there was a line 10-15 deep at the minimum $1000 bets,” said Frank Nein.  Nein, a diehard football fan just like the others who showed up Sunday morning, say they wouldn’t miss the start of the season for anything. And betting makes it all that more interesting to watch.

“Las Vegas benefits from the football season including taxi cab drivers, bartenders, restaurants everyone benefits from the NFL,” said Kornegay.  This is the second busiest weekend for sports book following Super bowl Sunday.

No surprises here.  Every guy I know is pumped up with the beginning for the NFL season.  Follow me on twitter to keep up on my NFL and college football picks.

Catching Up With Casino Stocks

Casinos that are publicly owned and traded on the stock market reported earnings from the second quarter this week.  Here’s a rundown of who did what.  I’ll let you decifer for yourself.

Pinnacle has a profitable quarter.

Penn National reports a fall in profit.

Wynn net income falls 90%.

Las Vegas Sands reports 2nd quarter loss.

Station Casinos files for Chapter 11

Station Casinos Logo

Station Casinos filed for Chapter 11 yesterday.  This day has seemingly been around the corner for a while now and it was only a matter of time for this to happen.  Chapter 11 doesn’t mean that a company will shut down.  Rather, it gives a business time to recover from their economic struggles with government protection.

Bill Lerner, an analyst for Union Gaming in Las Vegas, said the bankruptcy filing will give Station more time to negotiate with lenders. Under bankruptcy law, Station likely will have several months to exclusively propose a plan of reorganization.

The real question is what Station Casinos will look like if it makes it through chapter 11.  Odds are that it will become a little more streamlined as they sell off some assets to pay off debt.

Lerner said he is sure Las Vegas-based Boyd Gaming Corp. will seek some of the assets during the bankruptcy process, and said he wouldn’t be surprised if Penn National Gaming — which is interested in expanding to Las Vegas — also takes a look at the assets.

I’m obviously not a Las Vegas local but I have a soft spot for the locals casinos.  I like the option they provide for the local consumer and for me when I travel in.  The Gold Coast is almost always a stop for me when I visit Las Vegas.  Competition is always good for the customer.  Whether Station keeps all of their casinos or they sell some to Boyd I hope the competition lives with good management and good service for all.

Fontainebleau Files for Chapter 11

Fontainbleau filed for voluntary chapter 11 bankruptcy protection yesterday.   Construction has been marred by financial problems for the past couple of months and this continues the Las Vegas projects regression to completion.

“The decision to file for Chapter 11 was the direct result of certain lenders having refused to honor their contractual commitments to provide nearly $800 million in construction funding for the $2.9 billion resort-casino project, which is 70 percent complete,” the company said.

“It is unfortunate that our lenders forced us to take this step. By reneging on the revolving credit facility, they effectively shut down the project and put thousands of people out of work,” said Howard Karawan, chief restructuring officer of Fontainebleau Las Vegas. “Our goal now is to secure funding to complete this world-class project and restructure our existing debt.”

I still think that this doesn’t mean that the casino hotel won’t be completed…some day.  Obviously things will continue to be delayed, but I can’t imagine that a business this close to completion won’t open.  We’ll just have to wait a little while.

Construction photo below from the awesome website Vegas Today and Tomorrow.

Tropicana Las Vegas is Going Canadian

It seems as though east and west coast Tropicana’s are dueling for attention.  The Tropicana in Las Vegas is in the news today.  Onex Corp., based in Toronto, is proceeding with plans to take over the Tropicana in Las Vegas.  

Gaming newcomer Onex Corp., a private equity firm with $10 billion under management, says it’s proceeding with plans to take over the Tropicana hotel-casino in Las Vegas as the property emerges from bankruptcy protection.

The Toronto company this week said it’s been accumulating Tropicana debt and expects to take control of the property this year, subject to regulatory approvals and finalization of the bankruptcy case.

It will be interesting to see if a newcomer to the casino game can turn things around at the Tropicana.  They do have casino experience on the team.  The question to ask is if the hill is too much to climb.  My last trip to the Tropicana was a few years ago and I played Tic-Tac-Toe against a chicken and lost.

To be frank, the real estate alone may make the deal worthwile.  I’m looking forward to seeing how things turn out.

MGM Stocks Halted On Stock Market

Trading of MGM Mirage stocks were halted at the end of the trading day today.  This sent many Las Vegas watchers into a frenzy – myself included.  The news wasn’t as interesting as the chatter.  Straight from the horses mouth.

MGM MIRAGE (NYSE: MGM) and Dubai World through subsidiary Infinity World, 50/50 joint venture partners in the CityCenter project, today announced that the companies have reached an agreement on a revised joint venture agreement and also reached an agreement with CityCenter’s lenders on a comprehensive plan to fully fund the completion of CityCenter for its scheduled opening later this year. 

This is a bit of good news for MGM Grand.  If City Center is able to be completed as planned MGM Mirage shouldn’t have to divest any more properties to finish the project.

Station Casinos to File For Bankruptcy

It has been a rumor for a while that Station Casinos would either sell some or all of the company or file for bankruptcy protection.  Much like most rumors in the casino business this one is now true.  Station Casinos will file for bankruptcy protection by April 15.

Station had its attorneys file court papers Monday opposing a motion for a court injunction sought by a bondholder who is seeking to block the debt-exchange, a key part of Station’s plan to file a pre-packaged bankruptcy petition that would keep its business operating and includes a cash infusion of $244 million by Station owners the Fertitta family and Colony Capital.

Boyd Gaming is still moving aggressively to buy Station Casinos, but they’ve not been able to get that done.

“Station employs over 13,000 people and plays an important social and economic role in the local community. There is no reason to needlessly jeopardize the economic health of this company and its various constituencies so that a single bondholder can pursue spurious claims outside of the established restructuring process.”

It will be interesting to see how this plays out.  I really like Station Casinos because of their local flavor.  They’re always a nice change of pace from the strip casinos.  Nothing will effect my next trip to Las Vegas and I hope Station is able to fight through this.  This kind of feel like a fight for the little guy.  Go little guy!