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Path to Binion’s re-opening
a tricky one

Feb 24, 2004 4:51 AM

For the shuttered Binion’s Horseshoe, the road to its re-opening has become more convoluted. And the more twisted it becomes, the more concerned poker players are becoming over the prospects of this year’s World Series of Poker.

Last week, MTR Gaming Group and Harrah’s Entertainment announced a deal in which MTR’s wholly owned subsidiary, Speakeasy Gaming of Fremont, Inc. would purchase the Horseshoe, which would be operated jointly by Harrah’s and MTR.

The announcement followed an earlier revelation that Harrah’s and Binion’s owner Becky Binion Behnen had struck a deal in which Harrah’s would purchase the downtown hotel/casino for a small amount of cash and the assumption of a sizeable amount of debt.

Terms were not disclosed for either agreement.

Complicating the issue further were reports that downtown landowners, who own leases on which the Horseshoe stands, are demanding rent payments that have been in arrears for months.

For its part, Harrah’s wants to come out of the deal with ownership of the "Horseshoe" name in Nevada and all rights to the World Series of Poker. Harrah’s officials have vowed to re-open the Horseshoe by April 1, and host the 35th annual World Series of Poker at the casino beginning April 22.

MTR officials said it has obtained the necessary approval of its lenders but anticipates that it will close the deal by March 22 using cash on hand.

Upon closing, MTR will acquire title to the property and execute an agreement in which Harrah’s will serve as the primary day-to-day operator of the property on an interim basis.

"We are excited about the opportunity to own this Las Vegas landmark and to work with Harrah’s, a leader in our industry, to reopen the property for its loyal patrons, employees, and the city of Las Vegas," said Edson R. (Ted) Arneault, president and chief executive officer of MTR Gaming. "The Binion’s acquisition fits squarely within our previously announced goal to opportunistically acquire middle market gaming properties that complement our existing operations."

Those operations currently include the Mountaineer Race Track & Gaming Resort in Chester, West Virginia, Scioto Downs in Columbus, Ohio, the Ramada Inn and Speedway Casino in North Las Vegas, and a license to build Presque Isle Downs, a thoroughbred racetrack with pari-mutuel racing, in Erie, Pennsylvania.

The agreement will have an initial term of one year — after which time Harrah’s may extend for up to two more years.

While Harrah’s will retain rights to the Horseshoe name (to go with its recent purchase of Jack Binion’s Horseshoe properties in Mississippi) and the World Series of Poker, MTR will retain the right to use the name Binion’s in Clark County.

Once their operating agreement has ended, MTR will take over operation of the property and re-name the property in accordance with its newly-acquired rights.

MTR and Harrah’s have applied to Nevada gaming regulators and to the City of Las Vegas for approval of the transaction. A hearing on the applications has been scheduled for March 3 with gaming regulators and March 4 with city agencies.

Even if everything falls neatly into place and the hotel-casino reopens on schedule, some poker players fear the World Series will be a shadow of its former self.

"First of all, Harrah’s has never been a very big booster of poker," said a professional player who asked for anonymity. "It remains to be seen how much effort they’ll put into the World Series."

In addition, the pro player added, there’s a question as to whether Harrah’s cultivated the dozens of satellites that are required to help stage the World Series.

"It’s a little-known fact that most of the entrants in last year’s championship event had their $10,000 buy-in paid by a satellite casino," the pro player said. "The Horseshoe poker staff had set up satellites in about 50 card rooms and casinos across the country.

"Those card rooms, casinos and even online poker sites, put up the money for more than 700 of the World Series’ 839 entrants," the player continued. "George Fisher and his staff set those accounts up, but Binion’s fired George and his crew last year."

A telephone sampling of satellite poker rooms on Monday revealed that several poker rooms are conducting promotions that would send winners to the World Series.

Several others, however, are not participating as a satellite, and some casinos, such as the Mohegan Sun, no longer offer poker.