Online gaming manufacturer establishes beachhead in LV

March 20, 2001 5:39 AM
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So how close is Internet gambling for Nevada? New Jersey? The entire United States? One Australian company is betting that it’s not far off.

Gaming Entertainment Technology Pty. Ltd. (GET) describes itself as the "world’s leading provider of Internet gaming software solely for regulated, first-world e-gaming operators." GET has opened a branch office in Las Vegas. The company, founded in 1995, is based in Sydney, Australia. It claims its technology has been validated by a number of Australian states.

"With legislation pending to legalize regulated Internet gaming in both New Jersey and Nevada, we felt the time was right to establish a presence in the U.S. market," explained Tibor Vertes, company president.

"Our technology was designed specifically for strictly regulated environments so, as legitimate U.S. companies enter this market, we can offer a complete, "turnkey" solution that will provide these companies with unparalleled speed-to-market," Vertes said.

GET-USA will be headed by CEO Patrick Rogers. He most recently held an executive position with Las Vegas-based PurchasePro.com. Rogers’ past experience includes stints with Mirage Resorts Inc. and Players International.

Resting on his laurels

Louisiana Gov. Mike Foster has been resting on his laurels after successfully conjuring up enough votes in the state Senate to approve a tax cut for Harrah’s New Orleans Casino.

Now, say strategists, it’s time for Harrah’s 15 to 18 lobbyists to get the bill passed in the House.

But will it be a case of getting what you wished for and then regretting it?

That was the opinion last week of gaming analyst Danny Davila of Southcoast Capital. He has been watching the New Orleans scene from his catbird seat. He said last week that, even with a $50 million tax break, the casino couldn’t generate enough revenue to make ends meet.

Now comes Robin M. Farley of UBS Warburg, who has similar findings. Farley writes, "Even in a scenario if everything were to go right for the property, management expects that it would be only ‘modestly profitable’ — essentially break even.

"Given the limited upside, we believe a four-year guarantee of a new annual tax payment is a high risk for a low return," Farley notes.

Haunting allegations

Extortion allegations over his administration continue to haunt former Louisiana Gov. Edwin Edwards. On trial is his long-time friend and associate, Cecil Brown.

During testimony last week, an FBI agent — part of the investigation of Brown on the charge that he extorted payoffs from the Coushatta Tribe of Louisiana in exchange for a casino compact — said he and other investigators felt they had sufficient evidence to also charge Edwards in the case. The Justice Department disagreed, saying Edwards already faced charges in two other cases and it would appear that another indictment "would be piling on. The Coushattas later opened a casino in Kinder, La., and signed Grand Casinos (later, Lakes Gaming) as the operator.

Governor power

Illinois Gov. George Ryan would be in a position of power if a bill being considered by state lawmakers were to pass.

It would combine the Illinois Gaming Board and the Illinois Racing Board into one body. Under its provisions, Ryan could appoint the existing five Gambling Board members and four Racing Board members to the new combined group.

Rappaport to address CMA Meeting

The Casino Management Association will hold a meeting on Thursday at New York-New York hotel & casino. Guest speaker Felix Rappaport, NY-NY president and COO, will discuss customer service trends in the casino industry. The meeting is 6:30 to 8 p.m. Cost of the meeting is $5 for CMA members, $20 for others.

Foxwoods slots

It was another banner month for Foxwoods Resort Casino, although the total win was a shade lower than last year. Larger payouts were cited as the reason Foxwoods only banked $62.2 million for February, even though players pumped in $758.2 million, up $11.8 million over February 2000. Net win last year was $62.9 million.

"Higher payouts usually result not only in happy patrons but also in an increase in the amount of money they play," explained a northeast slots executive.

The state’s share of the slot revenue was $15.5 million.

Not licenseable?

When Hollywood Park Inc. (now Pinnacle Entertainment Inc. (PNK)), sold Turf Paradise to Jerry Sims and his associates, Arizona gaming regulators gave Sims’ group, TP Racing LLLP, a license to operate.

But now that Sims is requesting slot machines for his tracks, these same regulators are taking a completely different view. They now claim Sims withheld information on his application dealing with his alleged political payoffs in California and his alleged financial ties to Allan Glick.

In the mid-‘80s, Glick was the figurehead in charge of the Stardust Hotel/Casino in Las Vegas when it was being operated by Frank "Lefty" Rosenthal for mobsters. The story was illustrated in the recent movie, "Casino."

As for the California corruption charges, Simms said he was an unwitting victim of the operation, a claim that has been upheld by FBI investigators.

Slot machine love affair

America continues its love affair with the slot machine, it appears. Last week, a plan submitted to the Ohio House of Representatives to allow slot machines at the state’s seven racetracks was deemed "an odds-on favorite to win" approval.

But a church-sponsored opposition group vowed a bitter fight against the proposal, which it described as "just another back door effort toward casino gambling."

Lawmakers are trying to tie the slot machine measure to a plan supported by Gov. Bob Taft to expand the state’s lottery activity to include the highly successful Powerball operation.

The state, like many others, is looking for more money to increase the amount spent on education.

GTECH repurchase

GTECH Holdings Inc. (GTK) has agreed to repurchase some five million shares of its common stock from its largest shareholder, Tiger Management. The agreed-upon price was $26 a share.

It was noted, however, that the Tiger deal was outside the announced plan to purchase about $100 million worth of company stock on the open market.

Commenting on the Tiger Management agreement, new CEO Howard Cohen said, "The company has consistently maintained that GTECH stock is undervalued at current trading levels. We expect the transaction to be immediately accretive to earnings per share."