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Las Vegas Casino Ownership May Shuffle

William Eadington of the University of Nevada, Reno, says the multi-casino companies like Harrah's, MGM Mirage, and Las Vegas Sands are suffering from financial distress, and may be forced to sell resorts to the highest bidder.

A leading expert in the gaming industry says a number of Las Vegas casinos may end up with a change in ownership as the economy continues to plague the gambling world. William Eadington of the University of Nevada, Reno, says the multi-casino companies like Harrah's, MGM Mirage, and Las Vegas Sands are suffering from financial distress, and may be forced to sell resorts to the highest bidder.

"Ownership is likely to change with a number of the major companies," Eadington told the Las Vegas Review-Journal. "We're likely to see spinoffs at Harrah's, Las Vegas Sands and MGM Mirage."

The first of the equity sales occurred last year, when Phil Ruffin arranged to buy the Treasure Island Casino from MGM Mirage for $775 million. Since then, MGM properties have been rumored to be up for sale.

Company officials have said they would prefer to sell casinos in Biloxi or Detroit, but will let a Las Vegas Strip property go at the right price. Even the tony Bellagio has been shopped to see what interest might rise if the property were available.

Rumors have had the Rio All-Suite Hotel and Casino for sale by owner Harrah's. If Harrah's were to sell a Vegas casino, it would make sense that the Rio would be the one, as Harrah's other hotels all form a continuous section on the Strip, except for Caesar's Palace, across the street from the rest.

Eadington noted that some potential buyers, such as Penn National Gaming, may be waiting too long to make their move, hoping the market will drop even further.

"The impression I have is they're waiting for the price to get awfully close to zero," he said. "They're waiting for a giveaway. If they're waiting for The Mirage or some other property to get down to a price that is ludicrous, at that point, other buyers are going to be around."

Published on May 10, 2009 by PrestonLewis

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