PENNY STOCK AND LUMBER YARDS! There is a saying in Las Vegas that nearly everyone tries to win a lumber yard with a toothpick. If that’s the case, and you have a few toothpicks floating around, you might want to take a look at International Lottery and Totalizator Systems (ITSI). The lightly traded company is selling for around 77 cents a share. Certainly that’s about the price of a toothpick.
What makes the story interesting is that several in-the-knowsters are telling me that the Chinese government is ready to move forward with a national lottery.
They say that the company with its foot in the door is Berjaya Lottery Management Ltd. Berjaya has a major stake (72%) in the ownership of ITSI.
What does ITSI do best? Provide lottery systems - even very large lotteries such as the Chinese lottery would certainly be.
"It’s far from a done deal," said a pipe. "But it has at least a long-shot chance. And a piece of a lumber yard is not often available for 77 cents a share."
The pipe concluded: "For my toothpicks, it has the sweet smell of success!"
A DONE DEAL! Critics concerned about the Aladdin Hotel Resort’s London Club lease payment of $4.5 million need something new to worry about.
From my best sources comes word that the $4.5 million payment was made Friday.
"And," added a pipe, "if the Aladdin was in the dire shape that critics point to, why would they spend another $4.5 million?"
It appears that someone is trying to put pressure on the Strip property. Could it be that that someone is also trying to do a deal to take over the resort? That’s the story I’m working on. Stay tuned.
AN AUCTION WITH NO BIDDERS? That’s what some casino insiders are saying could happen if no one tops the $150 million bid offered by Peccole Nevada Corp. for the bankrupt Regent resort. Among the insiders are a number of Las Vegas casinos that are said to be interested in the Regent, but for amounts far less than Peccole’s stalking bid.
"I’ve talked to a number of interested bidders, but when they heard the $150 million number they all retreated," said a pipe.
"Interested parties were said to have included Coast Resorts, Station Casinos, Carl Icahn and others, but for far less than $150 million. It was somewhere between $70 million and $90 million."
At the same time, creditors of the Regent are saying that $150 million is going to cost them money. They are hoping for higher bids. If the Peccole bid wins, secured creditors will suffer a $500 million shortfall. Also, unsecured creditors will take it on the chin to the tune of about $125 million. Most of the unsecured amount comes from bonds that are subordinate to the mortgage notes.
A date of June 12 has been set to file objections to the bidding process. Otherwise, the opening bid will be $150 million. Higher offers will be welcomed, but at the rate of $250,000 per bid above the $150 million.
IT’S NOT OVER ’TIL IT’S OVER! And from what I hear the bankrupt National Airlines still shows plenty of signs of life. A bankruptcy court judge kept the skies open for National by temporarily blocking Harrah’s Entertainment’s (HET) bid to establish a reserve fund to use cash from ticket sales to help retire Harrah’s nearly $40 million of debt.
In the midst of it all, including overtones from billionaire Carl Icahn, National turned in some record events. In the last two weeks, bookings set an all-time record for Las Vegas’ hometown airline. Bookings of 20,000 each on Wednesday and Thursday set an all-time single-day record for National, now in its third year of operation.
Still more good news from National - the airline completed 3,892 flights of its scheduled 3,906. That represents a 99.6% completion rate, which figures to be the best in the industry.
WHEN YOU’RE HOT, YOU’RE HOT! WMS Industries Inc. (WMS) and its pride and joy, WMS Gaming, continues on its win streak. The company’s slot machines are taking California casinos by storm. The company has exceeded its estimates of how many machines they will sell in California. Consider that California has extended the time period for Indian casinos to install gaming machines by more than a year. Sources are guessing that WMS will have more than 90,000 machines in place in the Golden State.
Analysts have predicted that WMS Industries will hit earnings per share estimates of $1.42 for the current fiscal year and $1.69 for the following year.
Is it any wonder that the company hit a new 52-week high on Wall Street Monday, closing at $30.81, up 72 cents? Previously, its high was $30.42. And the volume was socko! A total of 502,000 shares were traded. That’s more than 200,000 shares above its 200-day average of 299,500.
DON’T BE CONFUSED! Nevada lawmakers’ off-again-on-again romance with an Internet gaming bill was finally consummated on Monday when the Senate signed off on the enabling legislation by a vote of 17-4.
There is a difference between enabling legislation and the right to begin. In a clever game of politics, the bills was left for dead last week but came out of the ashes this week and heads to Gov. Kenny Guinn’s desk alive and well.
Regardless of enabling legislation, the U.S. Department of Justice is still going to be the judge and jury before casino operators can obtain Internet gaming licenses.
A law that could prevent Internet sites from collecting on gambling losses is successfully working its way through Congress. It would put the hurt on Internet gaming since it prohibits the collection of gaming debts through credit cards, checks or electronic funds transfers.
DIFFERENCE OF OPINION! While legislation to permit Internet gambling came back to life in the Nevada Legislature, our neighbors in other states were taking a completely different view.
In California, the state Assembly by a 61-2 vote approved a bill that not only would punish the Internet company but also would fine any Californian participating in such gaming. The fine for the first transaction would be $25 but that would rise to $100 for later transactions.
For the Internet companies, conviction would bring a penalty of 90 days in jail and a fine of $1,000 per transaction.
Oregon is taking a different view, however. In that state’s Senate, a bill passed 57-2 to stop the use of credit cards as payment for gambling debts. Sponsors said the best way to shut down Internet gambling sites is to withhold their source of income.
HUSH HUSH! The buzz in the world of slots - which gets larger every day - is that Wells Gardner (WGA) might be "in play."
From a pipe in the yonder comes word that the Chicago-based company is attractive and might be on the block.
The company supplies video screens to slot makers. It recently signed a $40 million contract to supply video screens to WMS Gaming. Also, WGA is heavily involved in supplying many of the accessories used in slot machine play. WGA closed at $3.20 on Monday. A heavyweight buyer might boost the price into the $6 range.
WHO DO YOU LIKE IN THE BELMONT? I like A P Valentine. He won my fancy in the Preakness, and by finishing second he made a few bucks for me.
I think it will be a different story on Saturday when the Nick Zito charge contests the mile-and-a-half Belmont Stakes.
Caution: Unlike the Kentucky Derby, my success rate in picking Belmont winners is way off the mark. As a matter of fact, I haven’t picked one since Louie Rousell sent out Risen Star in 1988. That was the year Risen Star also won the Preakness but failed to Winning Colors in winning the Derby.
BOW WOW BUCKS! While animal protection activists in the U.S. are increasing their efforts to ban greyhound racing, an Internet company in England is setting up a world greyhound racing television channel.
With 31 dog tracks worldwide participating, a Sky Television channel will be offering wagering on greyhound races 24 hours a day with the betting taking place on Gaming Internet’s http://gobarkingmad.com greyhound racing site.