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Inside Gaming Column: Boyd Buy May be Kerkorian's Plan B

Wall Street sources are saying that if MGM Mirage's proposed buyout of Mandalay Resort Group fizzles, Boyd Gaming Corp. will likely be its next target. Kirk Kerkorian, the majority shareholder in MGM Mirage, is making mainly real estate plays, recognizing the value of Las Vegas properties, especially given the limited casino sites available. Also, word is Boyd stock is nicely priced as the company gets close to buying out Coast Casinos, a deal expected to close at the beginning of July.

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Fickle finger of fate. An MGM Mirage buyout of Mandalay Resort Group would spell big changes for Boyd Gaming Corp. Word is an emerging company may want to sell its 50 percent stake in the Borgata to Boyd, its joint venture partner. MGM Mirage would sell off the new hotel to raise capital to help pay for a Mandalay deal, and to avoid running up debt or to pay for further expansion. Harrah's Entertainment might also bid on the Atlantic City resort, having made no secret of its belief that the two hottest gaming markets in the country are Las Vegas and Atlantic City.

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Institutional investors with substantial holdings in Mandalay were dismayed Las Vegas Sands, owner of The Venetian, didn't precipitate a bidding war against MGM Mirage. They argue Sands owner Sheldon Adelson would have enjoyed locking up the private convention space and thumbing his nose at the Las Vegas Convention Center. They also say owning both centers would make operational sense and that the numbers crunch out right, but Venetian officials expressed concern they might not have the talent to pull off the deal.

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Sound and fury. Morale for some Coast Casinos workers is flagging as the July 1 merger with Boyd Gaming nears. Bartenders, casino hosts and midlevel managers say it's clear the emerging corporate culture will be Boyd's, and they fear changes in operations and layoffs. More fear a loss of the customer service that has been a hallmark of the Gaughan family in running Coast. Still, supervisors say the concerns are just normal willies any company goes through adjusting to a major corporate change.

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That's a mountain, albeit one of steel and concrete, going up on the edge of Sands Avenue at the Strip. Las Vegas developer Steve Wynn says it'll be a key to building the resort from the inside out. Pedestrians will only get a peek at the luxury inside from the corner across from The Venetian. Other than that, they'll have to go inside to see what his project is all about. This isn't going to be a replay of his sidewalk extravaganzas at Treasure Island, The Mirage or Bellagio.

The Inside Gaming column is compiled by Gaming Wire Editor Rod Smith. You can contact him by phone at (702) 477-3893, fax (702) 387-5243 or e-mail at rsmith@reviewjournal.com.

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