CasinoCityTimes.com

Gurus
News
Newsletter
Author Home Author Archives Author Books Search Articles Subscribe
Stay informed with the
NEW Casino City Times newsletter!
Newsletter Signup
Stay informed with the
NEW Casino City Times newsletter!
Related Links
Related News
Recent Articles
Best of Howard Stutz

Gaming Guru

Howard Stutz
 

Harrah's Plan for Singapore in Jeopardy?

5 October 2006

LAS VEGAS -- The first casualty stemming from this week's massive buyout offer for Harrah's Entertainment may be the company's proposal to build a casino in Singapore.

In a brief statement Wednesday, Harrah's said the casino operator would examine its bid to build a hotel-casino in the city-state's Sentosa Island region. The move left gaming analysts speculating that Harrah's and its Singapore-based partner, Keppel Land, would not submit a proposal by Tuesday's deadline.

Harrah's spokesman Alberto Lopez would not elaborate beyond the company's one-sentence statement, which said a $15 billion buyout offer from private equity partners Apollo Management and Texas Pacific Group that was revealed Monday, was the reason behind the decision.

"In light of the developments ... we are evaluating all our options in Singapore," Lopez said.

Harrah's lost in the bidding process to Las Vegas Sands Corp. in April when the Singapore government awarded the right to build the island-nation's first casino-resorts in the Marina Bay District to the developer of The Venetian. Las Vegas Sands plans to spend $3.6 billion to build the Marina Bay Sands.

Harrah's scaled back its ideas that the company proposed for the Marina site, which had included a 1 million-square-foot "urban theme park" featuring movie-themed attractions created by Academy Award-winning film director James Cameron.

Harrah's was the only major American gaming operator still seeking permission to build a casino in Singapore. If the company withdraws its bid, the second and final casino location will come down to competition between Malaysian casino operator Genting International, which has partnered with Universal Studios; a partnership between Kerzner International and Singapore-based CapitaLand; and a partnership between Starwood Hotels and Eighth Wonder, a privately held Las Vegas-based company led by casino designer Mark Advent.

Bear Stearns gaming analyst Joe Greff said Harrah's may withdraw because the private equity groups proposing to take the casino operator private, may not want to be scrutinized by the Singapore government.

"If Harrah's did win the license and was acquired, the new owners would have to go through probity checks by Singapore authorities," Greff said in a note to investors.

Harrah's Chairman, Gary Loveman, has been open with analysts and investors over the past year about the company's desire to win one of the Singapore gaming proposals. The company announced plans to expand internationally this year, saying it had signed agreements to build casinos in Spain and Slovenia while announcing a deal in September to buy London Clubs International for $530 million.

The buyout offer would call for the two private equity companies to purchase all outstanding shares of Harrah's for $81 a share. Harrah's, which operates 37 casinos in 13 states, has asked a special committee made up of nonmanagement members of Harrah's board of directors to evaluate the offer and make a recommendation on the proposal.

Harrah's Plan for Singapore in Jeopardy? is republished from Online.CasinoCity.com.