MGM Detroit set to open with or without politicians

October 02, 2007 5:37 AM
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Even a state shutdown of services in Michigan would not have prevented MGM MIRAGE Inc. (MGM) from opening their new $800 million Detroit hotel and entertainment destination resort on Wednesday.

But it was still nice to hear that the political fight between lawmakers and Gov. Jennifer Granholm over the state budget was resolved early Monday morning and all state workers were advised to go to their jobs as they normally would.

MGM and the other two Detroit casinos were spared the shutdown on Friday by a Circuit Court judge who condemned the state action in ordering the properties to close if no budget was agreed upon.

"Putting pressure on the legislature is not a reason to cause the devastation. I’m not going to do that. That devestation would have occurred in terms of loss of tax revenues and jobs for people if the casinos were shuttered," said Judge William Giovan.

Gov. Granholm had said casinos would be among the casualties of a partial state shutdown because state employees who monitor and regulate the casinos would be among those temporarily laid off. Casino lawyers argued that their casinos had enough surveillance and security in place that they could operate without state regulators on-site.

The budget was resolved when lawmakers agreed to balance the it by increasing the state’s income tax from 3.9% to 4.35%.

It wasn’t known how many state officials would be on hand at midnight Tuesday to join Jim Murren, president and COO of MGM MIRAGE Inc., in cutting the ribbon.

The property brings an elegant property to downtown Detroit with 400 guest rooms including nine rooftop VIP suites and 56 opulent corner suites.

WYNN offering

Steve Wynn shook up the investment community last week when he announced that Wynn Resorts Ltd. (WYNN) would offer 3.75 million newly-issued shares of its common stock at a price to the public of $158 each.

The shares had reached $166 per share on the trading floor but the announcement caused an immediate price decline.

That concern lasted only until Monday when the shares traded on the floor of the New York Stock Exchange for $165.17 per share, thus making the $158 per share offering look like a gift.

The company granted to Deutsche Bank Securities Inc., which is acting as sole book running manager and underwriter for the offering, an option to purchase up to an additional 562,500 shares to cover over allotments.

The offering was expected to generate up to $682 million in cash for Wynn Resorts which said it plans to use the proceeds for general corporate purposes and to enhance financial flexibility for future projects.

Unhappy advisors

Proxy Governance Inc., a company that specializes in advising shareholders how to vote at annual meetings has come out against the compensation committee of Landry’s Restaurants, Inc. (LNY), owner of the Golden Nugget properties in Las Vegas.

The advisors said the shareholders should protest the pay of Tilman Fertitta, chairman and CEO, as "out of line" with his peers.

In a note to shareholders, Proxy Governance said Fertitta had received $1.45 million in salary, a $1.58 million bonus and $11.4 million in restricted stock awards, plus $883,409 in "all other" compensation.

It also noted that LNY’s share performance was "lackluster over the past three plus years."

According to Landry’s proxy statement, Fertitta owns about 34.6% of the company’s outstanding stock.

THE INSIDER: International Game Technology (IGT) raised its quarterly cash dividend to $0.14 per share from the previous $0.13 per share. The dividend will be paid on Oct. 23 to shareholders of record Oct. 9.

Las Vegas Sands Corp.(LVS) said it will open its second hotel in Macau next month.

Infinity World Investments LLC, a subsidiary of Dubai World, has extended its cash offer for 14.2 million MGM MIRAGE Inc. (MGM) at $84 per share until Friday.

Station Casinos Inc. (STN) will pay its quarterly cash dividend of $0.2875 per share on Oct. 15 to shareholders of record on Oct. 5.

Gaming Partners International Corporation (GPIC) says it has completed the delivery of its RFID gaming chips to the expansed Wynn Macau.

The United Auto Workers Union has filed a petition with the National Labor Relations Board to form a union for about 3,000 dealers at Foxwoods Resort Casino.

College of Southern Idaho’s Community Education Center now offers casino jobs online courses. Tuition is estimated at $1,400 for instruction in dealing blackjack, poker and baccarat.

Breeders’ Cup has hired Peter Land as its new chief marketing officer. He formerly was global managing director of an international public relations firm.

Scientific Games Corp. (SGMS) announced it will close its San Antonio plant where the company employed 350 workers.

The Maryland Retailers Association is calling for the state to approve legislation for full-fledged casinos and not only slots locations.

Mountaineer Racetrack, owned by MTR Gaming Group Inc. (MNTG) plans to begin offering table games on Nov. 1. The track has delayed expanding its gaming floor to be sure that its dealers were properly trained.

The shareholders of Hilton Hotel Corp. (HLT) voted overwhelmingly in favor of the $47.50 per share buyout of the company by the Blackstone Group L.P.

Pinnacle Entertainment Inc. (PNK) said it plans to implode the Sands Casino Hotel in Atlantic City at 9:30 p.m. on Thursday, Oct. 18. This will be the first casino implosion in Atlantic City.

The Passmaquoddy Tribe in Maine has kicked off its drive to win passage of a ballot question that would allow the construction of a racetrack in Washington County. The vote is scheduled for Nov. 6.