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ATLANTIC
CITY —Acting Director David Rebuck
of the Division of Gaming Enforcement
today supported the approval by the New
Jersey Casino Control Commission of an
agreement to amend one provision of the
March 2010 settlement agreement between
the Division of Gaming Enforcement and MGM
Resorts International, Boyd Gaming and
Marina District Development Company. The
agreement allows for an 18-month
extension for MGM to control the marketing
and sale of its 50 percent ownership
interest in the Borgata Hotel Casino &
Spa in Atlantic City, from September 24,
2011 to
March 24, 2013.
Under
the initial settlement agreement, MGM was
required to place its 50 percent
interest in the Borgata into a divestiture
trust. The agreement resulted from the
Division’s investigation into the
development and operation of MGM Grand Macau
Hotel
Casino in Macau, China, by Hong Kong businesswoman
Pansy Ho. In the Division’s
May 2009 Special Report, the joint venture
partner in Macau was found to be unsuitable
and MGM was directed to disengage itself
from any business association with her.
MGM decided under the settlement to divest
its interest in the Borgata rather than
disengage from business with Ho. MGM was
required under the settlement to sell its
interest in the Borgata within 30 months.
MGM was granted control to complete the
sale
within the first 18 months. If no sale was
made in that time, the trustee appointed
by the
Casino Control Commission would have sole
authority to direct the sale process for
the
remaining 12 months.
“We’re
pleased with the approval by the Commission
of the relief requested in the joint
petition of MGM Resorts International, Boyd
Gaming and Marina District Development
Company,” said Acting Director David
Rebuck. “The 18-month extension should
allow
for a more positive result in the sale and
does not raise any integrity issues with
respect
to the operation and control of the Borgata.
We’re confident that this will be
beneficial to
the overall stability and continuity of
the Atlantic City casino gaming market.”
In support of the request for the extension,
the Division had to determine if the
requested relief was consistent with the
policies of the Casino Control Act and the
regulatory interests and objectives of the
Division. The Division found no evidence
that
the extension would impact its preeminent
focus to ensure “the public confidence
and
trust in the credibility and integrity of
the regulatory process and of casino operations.”
The Division’s response to the joint
petition filed with the Casino Control Commission
clearly emphasized that its agreement to
the amendment does not change any aspects
of its Special Report on the joint venture
with Pansy Ho, including those relating
to
MGM’s business partner and compliance
process deficiencies, and should not be
interpreted as a reevaluation of any finding
or conclusion set forth in its Special Report.
In its decision to grant the extension,
the Division gave significant weight to
the
Borgata’s decision to join MGM in
filing for the requested relief.
“The
decision of the Borgata to join with MGM
could only be prompted by a belief that
the relief requested would be beneficial
to all parties,” said Acting Director
Rebuck.
The fact that Governor Chris Christie has
made strengthening the gaming market in
New Jersey a priority, in part with the
creation of the Tourism District and the
regulatory
reforms enacted in February 2011, was cited
by both MGM and the Borgata as positive
indicators for attracting potential purchasers
during the extended time period.
“The extension granted to MGM in the
joint petition with the Borgata will ensure
sufficient time for the purchase as well
as for review of all regulatory approvals,”
said
Rebuck. “It’s consistent with
our commitment to ensuring the growth and
success of
Atlantic City’s economy while maintaining
the integrity of the gaming industry.”
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