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September 19, 2011

MGM’s New Macau Casino Deal

Filed under: Casino — Tags: , , — OCE News @ 12:00 am

The MGM Grand, Macau, is one of the many casinos and resorts that come under MGM Resorts International. The hotel cum resort opened its doors in Macau in 2007. The Grand stands as a 35-story structure with 600 rooms. The casino houses more than 1000 slot machines and as many as 427 gaming tables. Like all its casinos, the golden lion stands in front of the casino welcoming the guests to the MGM experience. The resort was opened in Macau as a joint venture with Chinese casino magnate Stanley Ho’s daughter Pansy. The joint venture started as a 50–50 deal.

In 2011 the 50–50 venture changed. MGM Resorts International was finally getting controlling interest in the Macau venture. This is on account of a new deal with Pansy. The new deal would give MGM 51 percentage, which is controlling interest in the casino. Pansy would get 29 percent and the remaining would be offered as public offering. The proceedings from the public offering would go to Ho’s ventures. Miss Ho would also receive $300 million worth of MGM’s senior convertible notes. Controlling interest in a casino in the gambling capital of the world is the target. This they have been able to achieve with this new deal with Pansy Ho. With the deal, MGM also aims to lead in the Macau gambling industry where other casino giants like Wynn and Las Vegas Sands are already leading the show.

The IPO is worth $1.5 billion. The fact that MGM is passing on that fortune to Pansy Ho comes as a surprise to many economists and financial experts. Though MGM would not gain from the IPO, the leaders of MGM state that the deal would only bring it benefit in the long run. In Macau casino revenues are skyrocketing every year. In the year 2010 alone, there was a rise in total gambling revenues that were somewhere near 45 percent. Therefore, the move by MGM to make a sacrifice in light of the bigger gains that await it is justified. There are also criticisms regarding Pansy’s decision to give up controlling interest in the venture. Some even criticize MGM of taking undue advantage of the lack of business expertise of Pansy. The company still claims that no such intent was there and the deal was struck after many days of negotiations with Pansy and her managers.

MGM further aims to strengthen its foothold in Macau by gaining land rights in Macau’s Cotai area. Here they plan to build a new casino. Other casinos like Galaxy and Wynn are set to open shop there. The Cotai area of Macau is the presently booming center where most gambling kings are looking on with interest.

MGM Resorts International is now more focused on its Macau operations. Las Vegas is diminishing in its capacity as a gambling destination. Macau has now emerged as the leader when it comes to gambling. More tourists and gamers prefer the grander settings of the Macau casinos to that of Las Vegas. As such, MGM’s strategy to build up the business in Macau is justified.

September 17, 2011

The Mexican Casino Massacre

Filed under: Casino — Tags: , — OCE News @ 12:00 am

Casino Royale in Monterrey, Mexico, has been in the news lately due to the terrifying attack that took place there recently. The terrifying act came in the form of eight gunmen entering the casino on Thursday, August 26th, 2011, and asked all the occupants to hit the floor. They then proceeded to explode a fire bomb in the casino after drenching the place in gasoline. There followed a massive fire that killed as many as 53 people.

The attack came in the wake of the impending drug wars that were taking place in the city for more than a year. The drug cartels have been demanding money from the casino owners. Casinos that are refusing to pay are attacked. This is cited as the main reason for the Casino Royale attack. Some also state that the attack came in light of the alleged connection between the drug world and the gambling business in Mexico. The attack in Casino Royale was not the first. The casino was targeted in earlier months as well by drug traffickers. Other casinos were also attacked by gunmen in May 2011. The attack was in the form of bullets fired at them. Luckily, there was no injury or life lost in those attacks.

The sight that followed the attack was heart-wrenching. Rescue workers found charred remains of people in places like office spaces, under furniture, and inside toilets. The rescue workers say that it looked like the people were trying to protect themselves from the massive fire and fumes and also from the gunmen. The fire fighters took more than four hours to control the flames and move into the casino to start the rescue operations. By then, many people succumbed to the heavy fumes that arose due to the fire.

The entrance of the casino was completely charred. The death toll from the attack is expected to increase from the now stated 53. From investigations done so far, there were around 80 people inside the building during the attack. Many out of these still remain unaccounted for. Some say that the attack on the casino came at one of its slow times and therefore the number of people in the casino was very few. At peak hours, the casino could hold as many as a thousand people at one time. The video surveillance images of the rescue operations painted a grim picture as fire fighters pulled out charred remains of bodies from the burnt structure of what once was Casino Royale.

The Mexican government is pleading to the United States of America to help curb the illegal drug trading between the United States and Mexico. The attack on the casino has had serious political implications within the Mexican government. The citizens of Mexico are looking upon the government with doubt when it comes to competency as they have failed to control the drug wars and the rise of the drug lords. The lack of a proper security system within the country is stated as one of the major reasons for such an attack on Casino Royale.

September 15, 2011

Casino Shutdown Due To Hurricane

Filed under: Casino — Tags: , — OCE News @ 12:00 am

When the hurricane hits, there is no other choice than to close up shop. This year, with Hurricane Irene set to hit Atlantic City, the casinos in the city are set to close. This means huge losses for the casinos even if the shutdown is only for a few hours. Losses of about three to four million dollars are expected.

The city officials declared a mandatory evacuation of the premises from 6 AM. Out of the 11 casinos, many are still planning to keep their rooms and restaurants open for those people stranded on the island. Gambling on the other hand has been shut down completely.

The city has 11 major casinos and all of them are preparing for the big hurricane soon to hit the city. They will be closing down business till Irene passes. In the past 33 years, such a total shutdown has only happened twice before. The casino’s business was legalized only in 1978 in the state of New Jersey. Since then, the state has been raking in huge revenues from the business. The first shutdown came in 1985 when Hurricane Gloria hit the island. Gloria being a Category 4 storm left extensive damages in most of the areas it hit. The damages caused by the hurricane was said to amount to $500 million. The second shutdown came in the form of a State government directive in 2006. Now the third shutdown is here, thanks to Hurricane Irene.

The Implications of a Casino Shutdown

A shutdown affects a lot of people. It does not just affect the casino owners. It affects all the others associated with the casino. There will be hundreds of workers in these casinos; many of them work on daily wages. Their means of livelihood is affected. Casinos have many suppliers. This could be suppliers of flowers to adorn the rooms and halls, suppliers of food, suppliers of specialized items like caviar, and so on. A shut down means that the casino would not be requiring these items for those days. The items would be wasted and spoiled. The supplier may incur heavy losses due to this. In short, a shutdown of the casino doors would mean a shutdown for all people associated with the casino. Their income is also hit in a big way and heavy losses are incurred. Sometimes these losses are so high that there will be no recovery point for the sufferer. The casinos as such recover quickly as their business is huge and a few days of good house wins would make up the loss. It is the smaller suppliers who rely on their association with the casinos that really suffer.

Be it Hurricane Irene or Hurricane Gloria, a complete shutdown means terrible losses for casinos and associated people. Casinos try and avoid the shutdown as far as possible. But when the situation is beyond human control, there is no choice than to incur the losses and hope to resurface later.

September 13, 2011

Genting New York

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New York is finally going to have its own casino. Ozone Park, one of New York’s famous neighborhoods in Queens, is where the first casino is set to open. The casino will be built at the Aqueduct Race Track. The area is a 192 acre expanse of land in Ozone Park. The casino is aiming to reel in the public with more than 4000 slot machines under one roof.

The casino is being developed by a company called Genting New York. Genting is a Malaysian casino giant. They have businesses in Malaysia, Singapore, and the United Kingdom. Genting New York is its subsidiary.

The company is eager to start this venture as it would mean entry into New York. The company already has other investments in the United States which dates back to 20 years. The building of the casino fell into the lap of Genting after it won the bid for the same in the year 2010.

Genting plans to have the casino set up with an entertainment section as well where there would be live shows and events. The casino will be called Resort World New York. Genting is set to build a similar casino in Miami, Florida, for which they have already acquired the land. Resort World Miami is expected to be larger than the casino planned in New York.

The Story Behind the Casino

The Aqueduct Racetrack has a history dating back to the 1800s when thoroughbreds were raced. The track was an instant hit and the place for many famous races. Horses included in the hall of fame have won many races on the Aqueduct tracks. In the year 2007, the Governor of New York went into discussions with his senate regarding closing of the racetrack and converting it into a casino. A bid was called and seven companies including casino giants like MGM and Wynn applied for the slot. The bid was won by the Aqueduct Entertainment Group. The winning of the bid by the group became highly controversial. Ultimately, the deal was withdrawn and a new group was chosen for running the casino. This is how the Aqueduct casino business fell into the lap of Genting. The casino is still under controversy due to the change in license by the state. Aqueduct Entertainment is planning to sue the state regarding the matter. Despite all these problems, the casino at Aqueduct is finally moving toward reality.

The building of the casino will itself bring in a lot of jobs for the area. It is stated that more than 1000 construction workers will get jobs during the construction work. Once the casino opens, there will be permanent posts for more than 800 people. Many of these would go to the locals.

This would greatly help in increasing the standard of living of the people in the area. The opening of the casino will also bring the state annual revenues in the likes of $500 million.

Finally, New York, one of the major hubs of the United States of America, will have a casino to call its own.

September 11, 2011

eCOGRA Achieves Own Accreditations

Filed under: Casino — Tags: , , — OCE News @ 12:00 am

The independent player protection and standards body that services the international remote gambling industry, eCOGRA, has managed to achieve two milestones: it is now qualified with the Italian regulator AAMS as a testing agency and has had its systems approved by the Geneva-based international standards authority, the International Organization of Standards (ISO).

About ISO

The ISO, which was founded in 1947, is responsible for setting international standards within various industrial and commercial spheres. Most of its work is carried out by technical committees, subcommittees, as well as working groups. They inspect and carry out assessments on companies that intend to improve the services they provide.

eCOGRA Explained

eCOGRA is an audit agency that provides advisory and compliance services in terms of fair gaming, player protection, and ensuring that operators act responsibly toward their stakeholders within the remote gambling industry. Its auditors have experience in information systems and Big 4 auditing. In 2011, eCOGRA will be involved with about 100 compliance reviews against a number of jurisdictional regulations as well as the European Gaming and Betting Association Standards, which incorporates the European CEN Workshop Agreement Measures.

Accreditation

eCOGRA, which is based in London, was awarded the ISO accreditation once it had met certain standards and requirements set by the agency. The approval given was ISO/IEC 17025:2005: General Requirements for the competence of testing id calibration laboratories. The accreditation, which was granted on July 22, 2011, is required by many remote gambling licensing jurisdictions in Europe.

eCOGRA can now be a testing and monitoring agency for a number of applications, including random number generators, remote gambling platforms, and gaming operators. It now needs to comply with the AAMS technical standards.

eCOGRA also managed to get approval from Amministrazione Autonoma Monopoli di Stato (Autonomous Administration of the State Monopolies), or AAMS. This means that it can be a testing entity within the Italian market. In Italy, AAMS regulates the gambling market, which includes setting the requirements and standards needed for operators and monitoring gaming licenses. This move by eCOGRA opens up a wide range of experience within this field to operators who want to move into the Italian market.

Achievements

The Chief Executive of eCOGRA, Andrew Beveridge, was very pleased with the achievement of his staff and praised their professionalism and commitment to reaching such high international standards. “Promoting the values of commitment and self-regulation, and preparing remote gambling companies for the national regulatory systems now evolving, remains a critical part of our business,” Beveridge said. “eCOGRA will continue to pursue testing agency approval in other emerging jurisdictions to ensure that we can provide a full-service offering which meets all of our client’s regulatory compliance needs.”

Beveridge expects that eCOGRA will be announcing more jurisdictional approvals in the near future. He is keen to be approached by any client who is interested in regulatory requirements concerning new licensing jurisdictions, in order to find out how eCOGRA can meet these demands.

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