Harrah's Aims to Access Debt Market by Adding License

When Paris Las Vegas opened in 1999, regulators allowed owner Harrah's Entertainment to license it through its sister property, Bally's, to which it is connected.

But last week, regulators allowed the company "to split the baby" in a restructuring and financing move that enables Harrah's to collateralize both properties.

The Nevada Gaming Commission, meeting in Carson City , unanimously approved the restructuring, licensing Chief Executive Gary Loveman as a director, Chief Financial Officer Jonathan Halkyard as treasurer and Anthony McDuffie as secretary of a newly formed limited liability company.

Several companies have brought new properties on line under existing licenses, but regulators said Harrah's move was the first instance of dual properties under one license splitting off.

Commissioners called the move "a novel proposition" after being told the restructuring would make it easier for Harrah's to access the debt market.

Formerly a publicly traded company, Harrah's went private in December when Apollo Management and Texas Pacific Group acquired it for $31.3 billion.

In other business, the commission approved the licensing of a North Las Vegas casino in a redevelopment area to a company that successfully redeveloped a Henderson property under similar circumstances.

Commissioners also appointed a new executive secretary to succeed Marilyn Epling , who held the post since 1988 and is retiring.

Commissioners are hoping Ken Templeton of Templeton Gaming Trust can work the same redevelopment magic in North Las Vegas as he did with a project on Boulder Highway last year.

Commissioners unanimously approved the licensing of Mystic Rose Casino at Cheyenne Avenue and Civic Center Drive, near Interstate 15.

Templeton is acquiring property across the street from the Speedway Casino and explained that his trust is getting 14 acres and a 40,000-square-foot casino floor, hoping to expand the all-slots floor to 150 machines initially and 200 total in the future.

The transaction was complicated because Templeton bought additional nearby land and is blending it with a casino operated under regulations that were grandfathered in. In addition, the property lies within a redevelopment area in North Las Vegas , and Templeton is applying for redevelopment grants.

Templeton said he hopes to expand the development in three phases, adding slots in the first phase, then adding 6,800 to 11,000 square feet for a bar, restaurant, table games and a race and sports book.

Templeton will have to return to regulators when the table games and race and sports books are added.

The project is similar to a project in Henderson that Templeton Gaming turned around.

Regulators praised Templeton for his efforts on the Charlie Holders Casino, which Templeton renamed Mystic Lodge. The commission approved that project in July.

At Mystic Lodge, the site — the original location of the PT Mining Co. — is zoned for gaming under a license grandfathered by Henderson .

The existing property had 116 slot machines and a leased sports book, but Templeton planned to phase in improvements and expansion over several months. Initially, Templeton planned to increase the slot floor to 212 machines and refurbish the existing casino with cashless machines and a player-tracking system. Ultimately, he's planning to develop a 50,000-square-foot casino that would have 600 slots, table games, bingo and two restaurants.

Commissioners also voted unanimously to appoint Brian Duffrin as the new executive secretary. He replaces Epling , whose last day with the state Gaming Control Board was April 18.

Duffrin , a longtime Control Board staff member, becomes the first man to hold the position in three decades.

Commissioners also:

• Approved options Scottsdale, Ariz. -based Atronic Americas LLC and Atronic International of Lubbecke, Germany , had to transfer ownership interests to Gtech Corp. and Gtech German Holdings Corp., respectively. The companies are subsidiaries of Rome -based Lottomatica S.P.A., which was licensed in Nevada in December.
• Approved transfer of 6 percent interest in the Downtown Casino Hotel in Las Vegas from the Steven Mack Gaming Investment Trust to Downtown Resorts LLC.
• Approved the licensing of five partners to acquire the slots-only Silver Miners Casino in Las Vegas . The applicants, Jack Lenavitt , Arnold Stansley , Richard Stansley, James Culbrandsen and Andrew Westmeyer , would each have a 20 percent interest in the property on Rancho Drive.
• Approved the licensing of Paltronics Inc. of Crystal Lake, Ill. , as a manufacturer and distributor of gaming equipment. Angelo Palmisano, president and chief executive , said the company manufactures and distributes multiproperty gaming systems that track accounting, bonuses and other gaming components.
• Approved rural horse-racing dates by three organizations. Commissioners authorized races for May 31 and June 1 for the Winnemucca Convention and Visitors Authority; Aug. 16 and 17 for Agriculture District No. 3 in Ely ; and Aug. 22 through Sept. 1 by the Elko County Fair Board.