Sale rumors swirl around elder Hilton

July 17, 2001 5:19 AM
by

share

   For example, take the recent whispers flying to and fro that Barron Hilton is thinking about purchasing the financially ailing Las Vegas Hilton from Park Place Entertainment (PPE). Barron owns nearly eight percent of Park Place. But, keep in mind that he was the father of the Las Vegas Hilton. It was the very first Hilton resort in the casino business when it opened in 1976.

   From what I hear, he woke up in shock when he realized that he had given the late Arthur Goldberg the OK to sell off his pride and joy to Las Vegas business tycoon Ed Roski.

   That sale was thwarted and is now deeply involved in litigation. Roski wants to go forward. Park Place and/or Barron Hilton don’t want to.

   One insider told me that the Las Vegas Hilton ”” if properly run ”” is a moneymaker. It sits next-door to the mighty Las Vegas Convention Center, which continues to grow by leaps and bounds ”” make that about a 50% expansion.

   Look what Sheldon Adelson did with the Sands Hotel. It sits in the shadows of the Sands Convention Expo and has had nothing but success.

   Oddly enough, I think the sale to Barron Hilton will drive up shares of PPE. Wall Street may not be focused on the turn around that convention hotels have made in the past 10 years.

   A rosebud ”” wise to the ways of Las Vegas casinos ”” thinks the whispers aren’t worth a dime.

   “They (rumors) walk like a duck, talk like a duck and are as daffy as a duck. In my opinion, it would be a major conflict of interest in light of the fact that Barron would be competing against the Park Place properties he has a stake in.”

   PSST! CAN YOU KEEP A SECRET? That’s what a pipe asked. I don’t know why? He went on to tell me that a well-known systems company is about to merge with a mighty gaming vendor company with multi-billion dollar revenues.

   “When the merger is complete,” the pipe continued, “it will shadow IGT (International Game Technology).”

   Wow! Tell me more.

   “Not now. But, you’ll be the first to know,” the pipe added.

   What a tease!

   HELP, MURDER, POLICE! Harrah’s Entertainment (HET) wants the “high sheriff and police” to ride after Station Casinos (STN) for allegedly infringing on Harrah’s patented Total Rewards promotion.

   “I hear the folks at Harrah’s are plenty hot. Its Total Rewards program has been a huge success by taking care of loyal customers,” said a rosebud.

   More: “Its U.S. patent covers technological innovations, which Harrah’s claims underlie the program. Total Rewards is available at Harrah’s 21 properties in 17 markets.

   “From what I hear, the lawsuit alleges that Station’s Boarding Pass is in violation of Harrah’s patent. They want the court to grant them a permanent injunction,” the rosebud added.

   Stay tuned. The resolution of this lawsuit could send ripples throughout the casino industry. You can bet that a number of casinos ”” seeing how successful Total Rewards has been ”” have ideas of their own. After all, stealing casino customers from one another is nothing new in the biz.

   But, HET won’t give up easily. The company also filed action against Stratosphere alleging that the Carl Icahn group violated its customer tracking system that rewards customers for slots play.

   Ah, to be a lawyer in Las Vegas!

   ON THE GROW! The Club Cal Neva has added a new satellite betting parlor ”” the new Siena Resort in downtown Reno.

   “It’s an upscale property and is among the 15 sites doing business under the Cal Neva banner,” said a pipe.

   IT’S A DOG-EAT-DOG BATTLE! And the outcome, thought to have been in favor of Magna Entertainment Inc. (MIEC) as recently as last Friday, remains unresolved as of today.

   The other big public corporation involved is Churchill Downs Inc (CHDN) and the prize is the New York City Off-Track Betting Corp. and its more than $1 billion in bets per year. When New York City boss Rudy Giuliani was elected, he found the NYCOTB in poor shape. He even remarked, “This is the only bookmaker in history that loses money.” He ordered NYCOTB sold to the highest bidder.

   Initially there were six bids, but they were whittled down to two ”” powerful Frank Stronach’s Magna Entertainment and the New York Racing Association with its partner, Churchill Downs.

   Although NYRA had a lot of friends in Albany, Stronach went one better ”” he hired powerful lobbyists with inside ties to both Mayor Giuliani and Senate President Frank Bruno.

   That, in my book, makes Stronach a big fave in this match-up.

   BADDA BING! Millennium Management, led by Bill Wortman and Bill Paulos are happy campers these days. The local Las Vegas gaming figures operate Greektown Casino in Detroit. Numbers released last week show Greektown, the newest of the city’s three casinos (MGM Detroit, Motor City and Greektown), up nearly 33% from its first month of operation.

   “There are 2,400 slot machines with an average win of $213 (per machine) in June,” said a source. “Table games average $2,133 per day. June revenue was $22 million.”

   A look at the figures clearly shows that Greektown is on the move. However, MGM Detroit still leads the way, even though its revenue of $30 million was down 4.7% from a year ago. Motor City enjoyed a 2.7% increase when revenue hit $28 million in June. Its 2,495 slots averaged a win of $263 per day. The 104 table games averaged $2,705 per table ”” up 34% from last June.

    ANOTHER REDSTONE WINNER? Leave it to ever-young Sumner Redstone to find the companies with cutting-edge technologies. The media magnate moved into WMS Industries (WMS) and Midway Games (MDY) long before they became hugely successful with new products.

   Now, he’s involved with Hollywood Media Corp. (HOLL), a multi-faceted technology company that has been motoring with its MovieTickets.com. By going to the company’s Internet site, moviegoers can buy their tickets online and avoid potential long lines at the theater, or possibly a “sold out” sign.

   The online tickets feature a bar code that tells the whole story. By merely presenting the bar-coded ticket at the movie house or even in some cases just by taking the ticket to a theater usher an admission is granted.

   Redstone, who has a 30% equity interest in HOLL, has signed MovieTickets.com for his 98 Showcase Cinemas. Actually, the Showcase Cinemas are owned by National Amusements, another Redstone gem. And the beat goes on, and on . . .

    CONNECTICUT COMMOTION! Two casinos vs. 12 casinos, which would you take?

   When you look at the total revenue in both markets, New Jersey draws more business ”” $2.1 billion ”” even though it’s a decrease of 1.1% from the same period last year.

   In Connecticut, where the Indian casinos report only slot revenue to state regulators, the Mohegan Sun reported a jump of 14.3% over June 2000 for a total of $52.6 million. Foxwoods Resort revenue was up 9%. It totaled $64.5 million.

   “Take your pick,” said a