Inside Gaming: Red Rock Resorts Purchases Palms, Complaint Against CG Technology Filed
This week’s installment of Inside Gaming reports on another big acquisition in Las Vegas, this one involving the Palms Casino Resort, a complaint being filed against a sportsbook operator for various violations, and another casino deal falling through in South Africa.
Red Rock Resorts Purchases the Palms for $312.5 million
Red Rock Resorts Inc. has announced that a subsidiary of its Station Casinos LLC has finalized a deal to acquire the Palms Casino Resort located off the strip in Las Vegas, reports VEGASINC. Red Rock Resorts is the new corporate name of Station Casinos, the appellation taken on for the company’s initial public offering in late April.
“With the acquisition of the Palms we gain a leading gaming asset in Las Vegas with key strategic benefits in the Las Vegas locals market and close proximity to the Las Vegas strip,” said Marc Falcone, chief financial officer of Red Rock Resorts.
While the deal still requires approval from regulators as well as the expiration of a waiting period mandated by federal trust law, the transaction is expected to be finalized by late summer. Red Rock has stated it expects to generate $35 million in earnings (prior to taxes, interest, depreciation, and amortization) during its first year owning the Palms.
The Palms, a much-frequented spot during the World Series of Poker thanks to its close proximity to the Rio All-Suite Hotel and Casino, has been open since 2001.
The move comes within a month of Boyd Gaming’s agreement to purchase the Aliante Casino and Hotel (originally owned by Station Casinos). Boyd is also moving to purchase Cannery Casino Resorts in an effort to expand its presence in north Las Vegas.
Read more about another casino operator expanding its presence in Sin City at VEGASINC.
Complaint Alleges Vegas Sportsbook Operator Underpaid Winners Among Other Violations
Sports bettors — at least those who take it seriously — often complain about how hard it can be to beat the juice and stay in front. But when the sportsbook isn’t playing fair either by underpaying or failing to pay winners, that makes the game even harder.
Earlier this week the Nevada Gaming Control Board filed a complaint against the sportsbook operator CG Technology alleging a number of violations, including underpaying winners, deliberately withholding information from bettors, and accepting bets after a sports event had concluded.
According to the Associated Press, the complaint comes two years after CG Technology was warned to avoid such violations following a $5.5 million settlement having to do with an illegal sports betting case.
Back in March 2015, a bettor at the Silverton Casino whose sportsbook is operated by CG Technology complained that he’d been underpaid following a winning round-robin parlay wager. According to the patron, it marked the fifth time he’d experienced the problem. The patron was eventually paid in full.
In addition to the Silverton, CG Technology runs sportsbooks in Las Vegas at the Cosmopolitan of Las Vegas, the Hard Rock Hotel & Casino, the M Resort Spa Casino, the Palms Casino Resort, the Tropicana Las Vegas, and the Venetian.
A spokesperson from Silverton confirmed to AP that the complaint “is between CG Technologies and the Nevada Gaming Control Board” and does not involve the casino.
Software glitches and a failure to follow-up adequately were cited as causing some of the problems, with instances of CG Technology taking bets on an already completed boxing match in May 2015 and a completed MMA match in January 2016 also listed.
The NGCB also complained that CG Technology failed to cooperate with its investigation, “including refusing access to its computers and documents as requested,” with such refusal “constitut[ing] a failure to comply with... all federal, state and local laws and regulations.”
CG Technology now has 30 days to respond to the complaint.
Learn more about the complaint at the Associated Press.
Sun International to Pay Peermont for Failed Acquisition
Sun International, the South Africa-based resort hotel and casino chain with over 25 properties in eight different countries, will be making a hefty payment to the casino resort group Peermont Global after a deal for Sun to acquire Peermont fell through when antitrust approval of the transaction could not be obtained, reports Bloomberg.
The settlement reached this week calls for Sun to pay R675M (almost $43M USD). Earlier Sun had agreed to pay as much as R900M to Peermont if the transaction fell through and a new complex in Menlyn Maine, Pretoria opened. That complex is scheduled to open in the spring of 2017.
It was during the spring of 2015 that Sun International had agreed to purchase Peermont for R9.4 billion, but an evaluation from the Competition Commission resulted in the deal being blocked because of its potential market effect, specifically in Gauteng.
Says Bloomberg, shares in Sun International have fallen about 40% since the Peermont deal was first announced.
Read more about the failed deal and settlement at Bloomberg.