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Non-Tech : Sungold Gaming International (SGGNF) -- Ignore unavailable to you. Want to Upgrade?

To: Archangel who wrote (3615)	4/28/1999 9:15:00 AM
From: kidl	Respond to of 5164

For Wednesday, April 28, 1999 Caesars World casinos sold for $3-billion Deal includes operating contracts for properties in Ontario, Nova Scotia By PAUL BAGNELL The Financial Post The most famous name in casino gambling was sold yesterday in a $3-billion (US) deal that also includes operating contracts for three Canadian casinos. Caesars World Inc., the owner and operator of five Caesars Palace casinos and an array of lesser-known gambling halls in the United States, Canada, the Philippines, and South Africa, is being sold by Starwood Hotels and Resorts Worldwide Inc. The buyer is Park Place Entertainment Corp. of New York, a company that was created late last year when the gaming division of Hilton Hotels Corp. was spun out to Hilton shareholders and later merged with Grand Casinos Inc. Park Place is paying $3-billion (US) in cash. Investors in Park Place applauded the news, sending its shares up $2 1/8 to $11.25 (US) in New York. Starwood's shares dipped 9/16 to close at $34 7/16 (US). The deal's premier assets include Caesars Palace casinos in Las Vegas, Lake Tahoe, and Atlantic City. The Canadian properties affected are casinos in Windsor, Ont., and Halifax and Sydney, N.S. They are owned by provincial governments, but operated by consortia in which Starwood is a major player. Casino regulators in Ontario and Nova Scotia said that the change in consortia membership would not require government reviews. Todd Jordan, a gaming industry analyst with Raymond James & Associates in New York, said the contract to manage Casino Windsor is likely a "high-return" deal. The Nova Scotia contracts are of less importance, he said. Casino Windsor racked up $567-million in gross gaming revenue in the first three quarters, ended on Dec. 31 last year, of its current fiscal year. Mr. Jordan, however, said Casino Windsor will face tough competition from three casinos that are to begin operating in Detroit, just across the Detroit River from Windsor, later this year. Casino management contracts usually give operators a percentage of both revenue and profit. The contracts between the government of Nova Scotia and the operator of the Halifax and Sydney casinos indicate the operator took home about 28% of after-tax revenue. The operator of the Nova Scotia casinos for the 1997-98 fiscal year was Metropolitan Entertainment Group, a company 95% owned by ITT Sheraton Canada Ltd. and 5% owned by a local firm, Purdy's Wharf Development Ltd. Starwood has since bought ITT Sheraton and now owns 95% of MEG. For the fiscal year ended March 31, 1998, MEG was paid $11.2-million out of net revenue at the Halifax casino of $39.7-million. In Sydney, MEG took away $6.4-million from $22.3-million in net revenue. Ontario Casino Corp. does not disclose operators' fees for the three individual casinos in the province, but overall it paid $67.5-million to operators in the fiscal year ended March 31 last year. Total revenue for the same period was $1.7-billion. Casino Windsor is managed by a 50-50 partnership between Starwood and Hilton. Casino Windsor racked up $567-million in gross gaming revenue in the first three quarters, ended on Dec. 31 last year, of its current fiscal year. Mr. Jordan, however, said Casino Windsor will face tough competition from three casinos that are to begin operating in nearby Detroit later this year. Casino management contracts usually give operators a percentage of both revenue and profit. The contracts between the government of Nova Scotia and the operator of the Halifax and Sydney casinos indicate the operator was paid about 28% of after-tax revenue. The operator of the Nova Scotia casinos for the 1997-98 fiscal year was Metropolitan Entertainment Group, a company 95% owned by ITT Sheraton Canada Ltd. and 5% owned by a local firm, Purdy's Wharf Development Ltd. Starwood has since bought ITT Sheraton and now owns 95% of MEG. For the fiscal year ended March 31, 1998, MEG was paid $11.2-million out of net revenue at the Halifax casino of $39.7-million. In Sydney, MEG took away $6.4-million from $22.3-million in net revenue. Ontario Casino Corp. does not disclose operators' fees for the three individual casinos in the province, but overall it paid $67.5-million to operators in the fiscal year ended March 31 last year. Total revenue for the same period was $1.8-billion.