Family owned hotel developer keeps adding to its gaming operations

Jun 28, 2005 4:19 AM

For more than three decades, Columbia Sussex was known mostly as a growing developer and manager of hotels throughout the country. Now, the family-owned company operates eight casinos in three gaming jurisdictions and that number will soon grow to nine casinos.

Columbia Sussex has agreed to pay $150 million to Penn National Gaming Inc. for the Argosy Casino in Baton Rouge, La. The property is owned by Argosy Gaming Co. Penn National is in the process of acquiring Argosy Gaming and has been shedding properties in order to ease the approval process from the Federal Trade Commission.

Founded in 1972 in Kentucky, Columbia Sussex is headed by William J. "Bill" Yung III, who serves as president and CEO. The company operates its hotels under the Crown Plaza, Holiday Inn, Marriott, Renaissance, Sheraton and Westin banners.

Among its casino holdings are: the Horizon Casino, Lighthouse Point and Jubilee Casinos in Mississippi; the Belle of New Orleans riverboat in Louisiana, and the Westin Casuarina Casino in Las Vegas, the River Palms Casino in Laughlin, and the Lake Tahoe Horizon Casino and Caesars Tahoe Casino in northern Nevada.

Court decisions

After months of haggling, the decision by Pennsylvania lawmakers to establish a slot-machine gambling law was upheld by the state Supreme Court, clearing the way for the establishment of 14 locations that can have as many as 61,000 slot machines.

Rejected by the court was the petition that challenged whether the law was constitutional believing that the legislature had exceeded its authority by transforming a one-page statute that statute that would have allowed state police to fingerprint people seeking horse-racing licenses into a 145-page law that effectively created an entire gambling industry.

The court’s unanimous decision was hailed by Gov. Ed Rendell, who became the biggest booster for gambling expansion when he became the state’s chief executive three years ago. However, opponents insisted that there will be other court challenges to increased gambling.

And in Florida, a state judge validated the approval of Broward County voters to permit racetracks to install slot machines at their facilities said they could begin operations as soon as July 1. Since the legislature failed to establish regulations and tax schedules for the slot operations, the tracks have been reluctant to go forward with the project. However, the judge said that if the state does not provide regulations the petitioners could return to him and he would arrange for them to proceed.

That probably won’t happen since Mike Satz, the Broward state attorney, filed an appeal to Judge Leroy Moe’s ruling, thus sending the matter to the Appeals Court.

THE INSIDER: Analysts at Bear Stearns have downgraded the shares of MGM MIRAGE Inc. (MGM) from outperform to peer perform. The move came as indications were revealed that except for rooms at Wynn Resort the room rates at Las Vegas Strip hotels for the summer months had dipped more than 4% from last year’s rates.

At Susquehanna Financial, analysts downgraded the shares of International Game Technology Inc. (IGT) from net positive to net neutral.

GTECH Holdings Corp. (GTK) says it has signed a product sale agreement with the operator of the national lottery of France. The agreement provides for GTECH to install new instant ticket vending machines at the operator’s locations. The company said total revenue from the agreement was about $5 million.

Youbet.com Inc. (UBET) notified the SEC that it was filing a $50 million universal shelf registration statement. The company did not indicate any immediate plans for the potential offering.

Boyd Gaming Corporation (BYD) will report its second quarter 2005 results on Tuesday, July 26, at l:30 p.m. PDT. Station Casinos Inc. (STN) will report on its fiscal quarter on Thursday, July 28 at 7 a.m. PDT.

The New Jersey Casino Control Commission has renewed the gaming license for the Borgata Hotel Casino and Spa, a facility operated by Boyd Gaming Corp. in partnership with MGM MIRAGE Inc.

Ameristar Casinos Inc. (ASCA) announced that the company’s stockholders had agreed to increase its outstanding shares from 11,000,000 to 14,000 000.