RSS 2.0 FeedVol. 4, No. 1, January 2008, Tumbling Dice
Crown Comes to Town
Cannery Casino Resorts—owned by Millennium Gaming Inc., a joint venture between Bill Paulos and Bill Wortman—and entities managed by Oaktree Capital Management, LP—owns and operates the Cannery Hotel and Casino in North Las Vegas, Nevada Palace Casino on Boulder Highway in Las Vegas and the temporary gaming facility at the Meadows Racetrack and Casino in Pittsburgh. The company operates the Rampart Casino in Summerlin, west of Las Vegas, and is currently working on a permanent gaming facility in Pittsburgh and the Eastside Cannery on Boulder Highway.
“CCR’s existing shareholders—Bill Paulos, Bill Wortman and Oaktree—have created first-class locals properties located in markets with attractive, long-term growth prospects,” Packer said. “Crown’s skills and experience in operating successful locals casinos will enable us to grow the CCR business further.”
Packer’s Crown Limited also won approval last week from Clark County commissioners to build a 1,064-foot hotel tower as part of its $5 billion Crown Las Vegas on the Strip, a joint venture with York Capital Management and Texas developer Chris Milam.
Packer also invested in April $250 million in the Fontainebleau Resort project on the Strip.
The acquisition makes it easier for Crown to enter the locals market buy tapping into an existing and proven brand, the company’s CEO Rowen Craigie said.
“The acquisition of CCR is strategically and financially compelling for Crown. CCR provides Crown with an entry point into the U.S. locals casino industry… without exposure to construction risks and without high capital expenditure requirements.”
The transaction will not close until Crown has the necessary approval from various regulatory bodies to own and operate all the casinos in the CCR portfolio—the Pennsylvania Gaming Control Board, Pennsylvania Harness Racing Commission and the Nevada Gaming Commission. The approval process is expected to take at least 12 months, but there could be some problems.
Packer has yet to apply for a casino license in Nevada, and Nevada Gaming Control Board Chairman Dennis Neilander said the application will be scrutinized, in part because of his relationship with Lawrence Ho, with whom he jointly opened the $540 million Crown Macau Casino earlier this year.
Lawrence is the son of Stanley Ho, who is alleged to have connections to organized crime in China. MGM Mirage was called before the Nevada Gaming Control Board earlier this year to explain its relationship with Stanley Ho’s daughter, Pansy, in Macau. The board, however, did not find any problems.
Gaming analyst Bill Lerner of Deutsche Bank said the relationship with Ho isn’t as big of a concern as some of the junket operators Packer partnered with to bring high-end gamblers to his Macau casino.
“Some of these guys, let’s say, might have trouble passing muster here in the United States,” he said.
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