Inside Gaming: Caesars Hires New Executives to Help Expand Beyond Gambling
Today's Inside Gaming shares news about Caesars' plans to get its largest operating unit out of bankruptcy and explore non-gambling opportunities, tells of a surprise deal struck between the Seminoles and the Florida governor, and notes newly proposed legislation in New Jersey designed to keep casinos open in the event of a state government shutdown.
Caesars Hires Two Executives, Exploring Non-Gambling Properties
Caesars Entertainment Corp. this week announced the hiring of two new executives "to help expand beyond gambling, including licensing Caesars and Harrah's brands to hotels that may not feature casinos," Bloomberg Markets reports.
Marco Roca will serve as president of global development for Caesars. Roca formerly worked with Wyndham Worldwide Corp. and Starwood Hotels & Resorts. Michael Daly will also join the company as senior vice president for strategy and mergers and acquisitions, having previously worked with the General Electric Co..
The announcement comes amid ongoing efforts by Caesars to enable its largest operating unit, Caesars Entertainment Operating Co., to emerge from bankruptcy. Current plans are to achieve this goal by September.
According to Chief Executive Officer Mark Frissora, brought on by Caesars in 2015, several possible investors have expressed in interest in the the company, attracted in part by Caesars' extensive loyalty program with approximately 50 million members.
"There's a lot of good money out there," said Frissora in an interview with Bloomberg Markets. "Developers would love to have these brands because they're unique in the marketplace."
Frissora mentioned opportunities being explored in Japan, Canada, Australia, Brazil and Dubai. Caesars is also considering acquiring casinos in Colorado, the northeastern U.S. "and any market where the company already competes but isn't No. 1," Frissora said.
Additionally, a "planned casino in South Korea catering only to foreigners is still on track, [Frissora] said, despite a Chinese restriction on travel to the country due to Seoul's deployment of an antimissile system."
By pursuing non-gambling ventures, Caesars follows a trend that includes both MGM and Wynn Resorts, both of which are similarly considering non-casino properties and investments.
Florida Governor Makes Agreement With Seminoles Over Blackjack
In a move that reportedly took Florida lawmakers by surprise, on Wednesday the state's Seminole Tribe and Governor Rick Scott struck an agreement concerning the Tribe's exclusive right to offer "banked" card games (like blackjack) in the state, reports the Associated Press.
The agreement involves the state dropping its appeal of a ruling delivered last fall by a U.S. District Court Judge in favor of the Seminoles in a case concerning the banked card games. The state is also promising going forward to take "aggressive enforcement action" against other businesses operating the games. Meanwhile the deal additionally paves the way for further payments from the tribe to the state.
Last year the Seminoles sued the state for having allowed racetrack casinos to offer "designated player games" the tribe felt were too much like blackjack. According to an agreement signed in 2010, the tribe had the sole right to offer blackjack in the state over a five-year period, with the tribe in turn paying the state $1 billion over that time.
The state countersued, citing that the tribe had continued offering blackjack at its casinos beyond the conclusion of the five-year agreement, though the tribe countered it only did so because the state had failed to uphold its side of the deal by preventing the racetrack casinos from offering the games.
The ruling went the tribe's way, giving them exclusive rights to offer blackjack through 2030 while also removing any obligation for the Seminoles to pay the state going forward. After initially appealing that ruling, this week's agreement means the state has dropped its appeal.
As noted, legislators were surprised by the announced deal, with some such as Senator Bill Galvano stating uncertainty that "the stipulated agreement does anything more than make it more difficult for us going forward to negotiate gaming with the Seminole Tribe."
Others noted how lawmakers had been left out of the loop when it came to the negotiations leading to the agreement. "To the best of my knowledge, no legislators were consulted on this specific agreement," noted Rep. Jose Felix Diaz, who added he was still looking over the terms of the deal.
Meanwhile Seminole spokesperson Gary Bitner praised the deal, saying the "agreement ensures a stable future for the members and employees of the Seminole Tribe of Florida."
New Jersey Government Shutdown Spurs Reconsideration of Law Covering Casinos' Closure
Last week in this space we were sharing news that the U.S. Supreme Court had indicated its intention this fall to review the federal ban against sports betting. The particular case to be reviewed involves the state of New Jersey's appeal challenging the ban being upheld after the state had tried to pass its own legislation to allow sports betting.
Shared in that story was Governor Chris Christie's enthusiasm regarding the Supreme Court's intention to review the case, with Christie describing it as a "very good sign for sports betting having a future in New Jersey."
Then over last weekend came the shutdown of New Jersey's government, caused by an impasse among lawmakers trying to finalize a budget for the new fiscal year. Christie himself earned some notoriety after a photo of him relaxing on a state beach closed due to the shutdown went viral online.
Three days into the shutdown Christie signed a new budget bill, and the NJ government is now back in business. The delay lasted long enough, however, for some to speculate whether the state's casinos could close if the government shutdown continued.
As NJ.com explains, a law was passed in 2008 preventing the state's casinos from closing during a government shutdown. However a provision in the law allowing the casinos to close should the shutdown last seven or more days caused some concern that the casinos could theoretically consider shutting their doors, a move that would cause great detriment to the state as a whole.
In the wake of the now-averted crisis, two NJ state senators have already proposed a bill to change the current law and remove the provision allowing casinos to close, the Press of Atlantic City reports.
"The casinos continue to be the driving force for the economy in the city and the entire region," said Senator Jim Whelan, one of the bill's sponsors. "Atlantic City is turning around, and to allow the casinos to close now or at any time in the future would be destructive to the lives of the casino workers and their families and would create an economic riptide with negative consequences for the entire city and region."
Approximately 50,000 are employed by the state's casino industry, notes the Press of Atlantic City.
Photo: "Caesars Palace Exterior," daryl_mitchell. CC BY-SA 2.0.
