MGM seeks to keep 50 percent share of Borgata
Feb 11, 2013 (Menafn - The Press of Atlantic City - McClatchy-Tribune Information Services via COMTEX) --In a dramatic reversal, MGM Resorts International is looking to keep its ownership in Borgata three years after it decided to leave Atlantic City in a dispute over an Asian partner whose father is allegedly tied to organized crime.
The Las Vegas-based company now wants its New Jersey casino license reinstated and is seeking permission to retain its 50 percent stake in Borgata Hotel Casino & Spa as a deadline approaches next month to sell it.
"MGM Resorts International is, and always has been, committed to the highest standards of operation and regulatory compliance. If our petition is successful we would welcome the opportunity to once again be an active, contributing member of the New Jersey gaming marketplace through our 50 percent ownership of Borgata," the company said in a statement Monday.
MGM has filed papers asking the state Casino Control Commission to reconsider the company's status for a New Jersey license. Matthew Levinson, the commission's chairman, said the petition will be considered at a board meeting on Wednesday.
"MGM has filed a petition to amend its 2010 stipulation with the Division of Gaming Enforcement so it can seek a ruling on whether it meets the state's license qualification requirements and reacquire its interest in the Borgata," Levinson said.
In March 2010, MGM agreed to sell its share of Borgata after the New Jersey Division of Gaming Enforcement objected to the company's partnership in a Macau casino with a Hong Kong businesswoman whose father has alleged ties to organized crime. Pansy Ho and her father, Stanley Ho, have denied any mob links.
The division conducted a lengthy investigation of the MGM-Pansy Ho partnership. It concluded that Pansy Ho was an "unsuitable" partner for MGM because of her father's reputed links to Chinese mobsters stemming from his ownership of Macau casinos.
In response, MGM decided to sell its ownership in Borgata rather than sever its partnership for the lucrative Macau casino. No buyers have emerged yet.
MGM is facing a March 24 deadline to sell its interest in Borgata, but now wants to retain its share instead. The remaining 50 percent of Borgata will continue to be owned by Boyd Gaming Corp. Up to this point, Boyd has not shown any interest in buying MGM's share.
In its petition, MGM argues that its New Jersey casino license should be reconsidered, because its partnership with Pansy Ho has changed since 2010. Previously, its partnership in the Macau casino was 50-50, but a restructuring has reduced Pansy Ho's stake to just 27 percent. MGM noted that it now holds a majority stake in the Macau casino and controls its board of directors.
MGM's petition portrays Pansy Ho as financially independent from her father and argues that he is in no position to "improperly influence" his daughter. MGM also said Pansy Ho has taken control of Shun Tak, the Hong Kong-based shipping, property, hospitality and investment company formerly dominated by her father.
"Stanley Ho is 91 years old and his health has declined precipitously in the last three years," MGM wrote in its petition. "Since July 2009 Stanley Ho has divested most of his business interests, including his interests in Shun Tak."
MGM, a giant in the casino industry, owns some of the best-known properties on the Las Vegas Strip, including Bellagio, CityCenter, MGM Grand, Mandalay Bay and The Mirage.
Over the years, MGM tantalized Atlantic City with promises of lavish casinos that were never built. In the 1990s, it abandoned plans for a Boardwalk casino in the South Inlet section. Another proposed MGM casino in the Marina District never materialized. Most recently, MGM shelved plans in 2008 for a 5 billion megaresort, proposed next to Borgata, because of the sluggish economy and global credit crisis.
Contact Donald Wittkowski:
609-272-7258
DWittkowski@pressofac.com
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