Caesars execs see end of era

Aug 24, 2004 5:10 AM

Sifting through the fallout from the Harrah’s plan to buy Caesars Entertainment (CE), there’s still much that has not been discussed in the media.

Top Caesars bosses who were not privy to the initial strategy that had Caesars Chairman Steve Bollenbach approaching Harrah’s CEO Gary Loveman to solicit the buyout have been complaining bitterly during moments when they are speaking among themselves.

What they see "is an end to civilization as they know it at Caesars Palace."

They expect Harrah’s to shut down high-end business, although Loveman has not said anything of the sort, if you hold his statements up to the light and read them carefully.

Among the unhappiest of all, according to my sources, is CE President Wally Barr who is not expected to stick around a moment longer than necessary in this new, bulked up Harrah’s.

So why did Bollenbach and Barron Hilton decide the time was right to get out?

They could see "Steve Wynn coming on like a freight train," as far as forces to be reckoned with on the Strip are concerned.

An insider confides, "Most of the capital development money has been put into Caesars Palace. All well and good, but what about the other properties in need of attention?"

Another source who cannot be identified by name tells me, "These guys were tired, out of bullets and sensing they were not going to win any races against Wynn, MGM and Harrah’s."

Gamers eye Nugget expansion

Development along the Fremont Street corridor will get a significant boost from plans Golden Nugget owners Tim Poster and Tom Breitling are preparing.

Poster’s target for "some kind of announcement" is the end of August. He had hoped to see it all come together a month ago. Buying additional property could be part of what T&T have in mind, but negotiations with the city to make a more efficient use of existing property possible is also part of it. Translation: they’d like some zoning variances.

What’s on Poster’s wish list?

"A larger sports book. We have a small place now, particularly when you consider the amount of business we are putting through there."

Poster is also planning for a larger lounge and a relocated permanent poker room. Oh yes, did we mention rooms? Poster says he and Brietling have been actively looking at ways to expand the Nugget’s existing base of about 1,900 rooms and suites.

If history is a good teacher, and it usually is in the gambling business, this is the kind of muscle-flexing that will have other properties doing what they can to keep pace.

While Poster plans for the future, he’d like to avoid going public, if possible.

"I am not so sure Wall Street and gaming mix too well," he says. "On the one hand you can say that Wall Street is what has enabled this tremendous growth we have had in the last 20 years. But the gambling business has had to redefine itself to make it attractive to Wall Street.

"It is not like the old days when individual owners ran these places and each had a personality all its own and they did not have to answer to shareholders. I think the worse part of it now is that these companies have to manage themselves for each 90 days. The needs of the business don’t always lend itself to that kind of thinking. If I had my druthers I would like to operate as a private company as opposed to going public. I hope I will be able to stay on course and continue without the need of going public. But I also recognize that it could become a necessity if certain opportunities came up."

New time, site for World Series of Poker

Next year’s World Series of Poker has been moved, but not very far. Harrah’s owns poker’s biggest event now and will be holding most of it at its Rio where an expansion of the convention area is in progress.

The World Series is poker’s biggest party and normally begins about mid-April and takes up much of May. But the 2005 WSOP will begin during the last half of June.

Harrah’s execs want to make certain the convention center is complete. The extra time will help ensure planners can make whatever targets they might have for generating entries.

Nearly 2,600 people played in the no limit hold ”˜em finale at the Horseshoe in May and Harrah’s officials are believe to be looking for a total on the order of 6,000 next year.