Diamondhead Casino signs letter of intent
By MARY PEREZ
meperez@sunherald.com
DIAMONDHEAD -- Diamondhead, Austrians to team up
Diamondhead Casino Corp. has signed a letter of intent with an Austrian company to develop and operate a casino resort off Interstate 10 at Diamondhead.
The nonbinding agreement announced Monday with Casinos Austria International Holding is for 50 of the 404 acres the company owns in Hancock County.
This would be the first U.S. venture for Casinos Austria, which operates 215 casinos in 35 countries, including 80 casinos on international cruise ships. In 2007, CAI had 19.9 million casino visits and earnings equivalent to about $5 billion.
"We've been patient and we've been rewarded," said Gregory Harrison, vice president of Diamondhead Casino, which had negotiations with several other large casino operators. Last July, Diamondhead Casino rejected an offer of $100 million for its property, which sits between two miles of shoreline on the Bay of St. Louis and two miles of interstate frontage. It would be the first casino in Mississippi directly off I-10 and the most accessible for gamblers driving west from Louisiana and Texas.
Diamondhead Casino will retain the property rights and get a percentage share of the casino operation. The company's stock rose on the news Monday from $1.40 to $1.96.
"It will be more than a casino," said Harrison, who envisions a resort plus townhouses, outlet mall and other amenities. "We own the land around it," he said.
Casinos Austria loaned Diamondhead Casino money in 1992 to buy the property. "They never forgot that this little company with no money paid them 100 cents on the dollar," he said.
While other casino projects are struggling to get financing, Peter Lux with Smith Barney pointed out that Casinos Austria is dealing in the stronger Euros. The hotel and other amenities could qualify for Go-Zone tax incentives, he said, although legislation to extend the start date for construction would require the approval of Congress.
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