Indian casino to benefit Lakes Entertainment

Mar 29, 2005 5:44 AM

A federal judge in Michigan has ruled in favor of an Indian tribe’s casino plans but the real beneficiary may be Lakes Entertainment Inc. (LACO).

At issue was the Berrien County casino proposed by the Pokagon Band of Potawatomi Indians that was opposed by the anti-casino group called Taxpayers of Michigan Against Casinos. The group alleged that the Bureau of Indian Affairs had not adequately evaluated the environmental impact of the casino.

The judge disagreed. He found that the "BIA has not ignored any areas of concern."

If there are no further legal appeals, the Pokagons can go forward with their plans, first, having the BIA take the 675-acre parcel of land in New Buffalo Township into trust for the tribe and then begin construction of the 144,000 square foot Four Winds Casino Resort.

Lyle Berman, chairman and CEO of Lakes Entertainment who was one of the founders of the former Grand Casinos Inc., a company that was one of the first to assist in the development and operation of Indian casinos in Wisconsin and Louisiana, hailed the judge’s decision. "This is a lawsuit that has taken four years to resolve and has taken four years away from the Pokagon Band’s efforts to become self-sufficient," he remarked.

Berman added that the casino will be the only land-based casino in the northern Indiana/western Michigan market. He said the company expects to have the first phase involving 3,000 slot machines and 100 table games in operation within 10 to 12 months after construction begins.

Lakes Entertainment has several other Indian casino projects awaiting approval but has none operating at the present time. However, the company is the largest shareholder in World Poker Enterprises Inc. (WPTE).

BIRD IN FIGHT

When the original proposals for a French Lick casino license were heard last year, favorite son, Indiana basketball legend Larry Bird, didn’t even finish second. The Indiana Gaming Commission awarded the license to the bankrupt casino company operated by Donald Trump.

This time, however, things could be different.

When the regulators get around to considering the applications, Bird will have a more prominent partner, Nevada Gold & Casinos Inc., an experienced operator as a partner. The company has taken a 75% position in Orange County Development LLC.

Other partners in the group are former Nevada Gov. Bob List, and two Indiana businessmen.

BATTLE LOOMS

Churchill Downs Inc. (CHDN) officials are planning a multi-million facility to house slot machines at the Fair Grounds racetrack in New Orleans, La., but a problem has developed within the City Council over language in the City Charter that restricts gambling to Harrah’s New Orleans Casino.

If a legal opinion determines that the charter has to be amended, it probably would require another community vote, a move that could cause problems for the company whose sole reason in acquiring the property was to install the slots. Some neighborhood residents have been expressing concern on the operation of the track casino, bothered they said by such things as hours of operation and the security to be provided.

One councilor said he believed that if Churchill agrees to provide security money that would turn the area into a crime-prevention district, the area residents might agree to longer hours of operation.

THE INSIDER: New Jersey gaming regulators have approved the sale of the Atlantic City Hilton to Colony Capital LLC for $513 million. The A.C. Hilton is owned by Caesars Entertainment Inc. (CZR) which is being acquired by Harrah’s Entertainment Inc.(HET).

Hilda A. Manuel, former deputy commissioner of the Bureau of Indian Affairs (BIA), has been named senior vice president for Native American Affairs by Empire Resorts Inc. (NYNY).

A subsidiary of Scientific Games Corporation (SGMS) has been granted a contract for a new online gaming system by SWISSLOS, the state lottery operation of Switzerland. The contract has been valued at about $7.8 million.

Analysts at UBS have begun coverage of Las Vegas Sands Corp. (LVS) with a "neutral" rating.

Because the newly-appointed members of the Illinois Gaming Board could not act on the proposed merger of MGM MIRAGE Inc. (MGG) and Mandalay Resort Group (MBG) before the end of the month, company officials have delayed closing on the merger until some time in the second quarter. Also, MGM MIRAGE said it had agreed to sell MBG interest in MotorCity Casino to Marian Ilitch for $525 million, as reported in GamingToday last week.

Rumors that Louisiana would increase the gaming tax rate were quashed last week by Gov. Kathleen Blanco whose spokesperson said that there would be no consideration given to that method of paying for a teacher salary increase. However, no decision has been made on increasing the levy on video poker and slot machines at racetracks.

Tom Cook, who joined Harrah’s Entertainment Inc. (HET) in 1995, has been appointed senior vice president and general manager of Harrah’s North Kansas City Casino and Hotel. He will leave his post as general manager of Harrah’s Ak-Chin Casino Resort.

Richard Hart and Jonathan Broome, who were functioning as executives at Lakes Region Greyhound Park in Belmont, N.H. until they were indicted by federal officials on alleged violations the Wire Act through a company called International Players Association LLC of Concord, N.H., have been terminated. State regulators will decide soon whether to end wagering at the track as has been requested by the state attorney general.