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Inside Gaming: Colony May Have Eye for Rio Buy

Rumors were flying on Wall Street last week that Colony Capital is seriously interested in buying the Rio from Harrah's Entertainment. Colony already has agreed to buy four casinos involved in the $9.4 billion Caesars Entertainment sale to Harrah's. Analysts said Harrah's likely would be interested, even if the company is unlikely to have antitrust problems in Las Vegas, if it could get the same 8.5 times cash flow it is getting for the other properties, or more than $1 billion. Also in the rumor mill: The Flamingo, owned by Caesars, is drawing interest.

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In the Gulf Coast area, Columbia Sussex Corp., which seems to have set its sights on becoming a key player in the gaming industry, is said to be in talks to buy Bally's Belle of New Orleans and possibly the Flamingo Hilton Laughlin. The Fort Mitchell, Ky.-based hotel-casino holding company bought the River Palms in Laughlin and Harrah's Vicksburg Hotel & Casino in Mississippi last year. Columbia Sussex also recently bought the Maxim in Las Vegas for $38 million and owns the Lake Tahoe Horizon Casino Resort.

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The betting public is laying odds President Bush, a leading opponent of casinos, will be re-elected in a landslide. Futures players using the Iowa Electronic Market are betting 3-to-1 Bush will slam Sen. John Kerry on Nov. 2. So far, 2,800 traders have bought $290,000 in futures contracts, or wagered legally, on the IWeb site operated by faculty at the University of Iowa, about in line with past betting on presidential politics, a spokesman said. Post-debate bets on the offshore Olympic sports book, however, showed a significant erosion in the odds favoring Bush.

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For Las Vegas developer Steve Wynn, agreeing last spring to send his art collection to Reno was a mitzvah. For the Nevada Museum of Art in Reno, it was a lot of heartburn over tight security, insurance costs and environmental controls. But the 14 works of fine art by masters from Rembrandt to Picasso are finally moving up north, although about four months later than we expected when we reported the deal early this year. Wynn worked the deal out with Harrah's Entertainment Chairman Phil Satre, who called it a big coup for Reno.

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Gaming critics have said opposition from Warren Buffett, one of the world's richest men, is sounding a death knell for gaming initiatives. Gaming proponents, however, say that contrary to the conventional wisdom, Nebraskans don't give a hoot what Buffett thinks. That doesn't mean the two ballot initiatives, one supported by Sheldon Adelson, owner of The Venetian, and the other by Michael Gaughan, former owner of Coast Casinos, will pass. It just means buckets of cash may be worth more than a name.

The Inside Gaming column is compiled by Gaming Wire Editor Rod Smith. You can contact him by phone at 477-3893, fax 387-5243 or e-mail at rsmith@reviewjournal.com.

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