This page contains a Flash digital edition of a book.
CR78-p01-News 1:SJC-Casino Review 22/3/09 01:16 Page 1 • April 2009 • 078
Sands Of Time Beating The Community
Wiedener Crunch Chest
parts company IGT’s plan to beat Uniting play
with Sands the recession at the slots
MGM Mirage warns of
possible defaults
stressedstates The company, which Lerner believes most includ-
UNITED STATES recently offloaded the Treas-
In what has been the most visibly worrying month so far
ing MGM Mirage have enough
ure Island casino on the Las
Global operating giant MGM Vegas Strip to developer Phil
for many debt stretched US operators, even MGM Mirage
options to cash in, slim down
and insulate themselves until
Mirage is hoping it can modify Ruffin for $775m, delayed
has warned it could be at risk of defaulting. However, as
the economy bounces back.
its senior credit facility filing its annual report until
Phil Martin reports, analysts believe there is enough
Speaking at the Reuters
warning that it may default on March 17 because it is still
liquidity to pull through.
Travel and Leisure Summit in
its debt repayment, a point of analysing its financial stand- New York Lerner said: “I think
concern for investors in light ing and requirements. MGM equity will change hands. The
of the company still needing outlined that the delay fol- composition of the industry
to secure US$1.2bn to com- lowed its financial realign- will be different.”
plete construction of City- ment after tapping into He said that selling assets
Center on the Las Vegas Strip. $842m of its $4.5bn senior would be key. “I wouldn’t be
It announced that it lost revolving credit agreement to surprised to see more from
$1.15bn in the fourth quarter cover what it termed general MGM,” he explained. “I don’t
of 2008 and said it had to expenses. The group had not think any property is out of
make some difficult decisions reported any financial results the question They’ve got an
on how to cope with more since September when it had arsenal of weapons that they
than $13bn of debt. $13.29bn in long-term debt. can launch to address liquidity
“I have no illusions that As well as selling TI, MGM has and to some extent leverage.”
this is going to be easy,” CEO had less publicised sales of He included parts of City
Jim Murren said. “I do not at other venues, including land Centre, which is due to open
all harbor any ill feelings in Nevada and New Jersey, in December, in that assess-
towards people who think and two airplanes. ment. “They could sell a hotel
we will fail, because this is Analyst Robin Farley of tower or a residential hotel
not without risk. But I wake UBS Investment Research tower to a hotelier,” he sug-
up thinking that we’re going revealed that MGM Mirage gested, adding that whilst
to make progress every day.” and City centre partners MGM has enough liquidity to
Revenue fell to $1.6bn in Dubai World both need to resolve 2009 by using its 2010
the quarter that ended inject about $1.3bn into City- debt maturities it needed to
December 31, from $1.93bn Center this year. ‘quell concerns that they are
a year earlier. “MGM had expected to going out of business.’
“We are not actively out fund their portion with Lerner added: “Covenant
there marketing our proper- condo sales proceeds; relief is not that big of a deal.
ties to buyer groups. We have however, we expect many of You pay for it, but it happens
had a very high level of inquiry the condo sales may not in other industries all the time.
on either individual assets or close,” he said. I think companies will be
groups of assets,” Murren said. According to MGM chief extremely conservative with
“We have some smart people Murren, the company is explor- balance sheets. The focus will
looking into all this.” ing a half-dozen deals around be less about expansion, more
MGM said in an unsched- the world in which MGM about consolidation.”
uled filing with the Securities Mirage would lend its name and Murren concluded that the
and Exchange Commission expertise to generate income. company, which has access
that unless the economy It has already signed up for such to $600m of cash, would have
picks up and there is a dra- a venture in Vietnam. to lower its debt, but had to
matic increase in gambling Whilst plummeting shares view its casinos as long-term
spend, it will break its loan might suggest that many of money makers and not just
agreements this year, result- the world’s leading operators
The Bellagio, one of 17 MGM Mirage properties
commodities to cash in on
ing in a default on its senior are close to bankruptcy, located in Nevada, Mississippi and Michigan for quick fix but potentially
credit facility. Deutsche Bank analyst Bill undervalued sums.
Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58
Produced with Yudu -