This could be the year of the merger

Jan 21, 2003 8:08 AM

 

MERGERS, MERGERS, MERGERS! That’s what our pipes and rosebuds are telling us to expect in the months ahead as 2003 unfolds.

"I think you’re going to see a lot of action in the middle-sized properties this year," said one in-the-knowster. "Some will merge to form bigger entities and I predict that at least one will be acquired by one of the Big Boys."

A rosebud had this to say: "Don’t be surprised to see a merger announced this year between a couple of the top players. With the economy the way it is and expenses continuing to rise, everyone is looking at all the possibilities. Good operators are the key to success."

Those sentiments were reflected by a pipe: "Keeping expenses in check is the real key to success. The people at MGM Mirage (MGG) know that. Check it out. This past year they increased their EBITDA nearly 20% on basically the same cash flow as the prior year. You can attribute that to sound operational skills of upper management.

"Companies that can’t run a tight ship are going to be looking at joining those who can, either through merger or acquisition."

 

 

BRANDED BY SUCCESS: Max Baer Jr. did such a good job of playing "Jethro Bodine" in the television sitcom "Beverly Hillbillies" that he was typecast forever, he told interviewer Bill Griffeth on CNBC last week.

Currently working with International Game Technology in developing and marketing slot machines based on the "Beverly Hillbillies" theme, Baer said his acting career might have been different had it not been for the Jethro character.

Asked what roles he might have enjoyed had they been offered, Baer, son of the one-time world boxing champion, Max Baer, said he fancied himself in roles played by either James Garner or Tom Selleck. He said he felt his "humorous personality" was similar to those two actors.

 

NO BULL, HERE: Wyoming cowboys who participate in professional rodeo events have become part of the gambling discussions in that state.

Lobbyists for Wyoming Downs Inc., purchased a couple of years ago from thoroughbred racing executive Joe Joyce by Las Vegas auctioneer and real estate developer Eric Nelson, are suggesting to Wyoming lawmakers that pari-mutuel rodeo wagering would go a long way toward saving the racing industry in that state.

Officials said the Evanston, Wyoming, track is facing a deficit this year of some $300,000 despite record betting levels in 2002.

The proposal went so far as having a House bill written for it but no action was taken last week when it came up in committee. Some lawmakers were worried that approval would open the door to other forms of gambling.

But, the bill isn’t dead year and lawmakers promised to consider the matter in a couple of weeks.

Where professional bull riding is so popular in Las Vegas, maybe arrangements could be made to link the championships to the Wyoming pari-mutuels.

 

SLOT REVENUES STILL GROWING: No question America has a fascination with slot machines. And that interest keeps showing up in the expanding gaming landscape.

Not to be outdone are the established, or so-called mature markets, of both Atlantic City and Nevada.

During 2002, for the 22nd straight year, slot machines accounted for the biggest piece of the gambling pie in the New Jersey gaming mecca. According to reports, slot revenue reached $3.3 billion or 74.4% of the total gambling revenue generated by the 12 casinos.

Percentage-wise, Nevada was close-by. For the 12-month period ended on Nov. 30, 2002, slot revenue for the entire state totaled $6.2 billion or 66% of the total gaming revenue of $9.4 billion.