Boyd Gaming Offers to Buy Station Casinos

by Michael Rome on Feb 24, 2009 1:11 PM EST in MMA News

Here's an interesting story from Forbes tangentially related to MMA:

In a letter to Station Casino Chief Executive Frank Fertitta III, Boyd CEO Keith E. Smith and Executive Chairman William Boyd said the company was willing to pay $950 million in cash for most of the assets except for those secured by certain loans.

The price excludes assets secured by the commercial mortgage-backed security mortgage loan and related mezzanine financings due this November and those secured by a $250 million term loan due Feb. 7, 2011.

But Las Vegas-based Boyd said it would be interested in buying these assets if they're for sale. It has access to $2 billion in a revolving credit facility.

I don't often post on the business of Station Casinos because it's very complicated and mostly unrelated to MMA, but a full buyout of Station would likely bring Frank Fertitta over to Zuffa as well. Of course, it wouldn't surprise me if a potential sale kept Frank and others on board as part of the new version of Station Casinos.

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the company was willing to pay $950 million in cash

Dang, why don’t I own a bunch of casinos?

Kuwabara Kuwabara

by J. B. Maddox on Feb 24, 2009 1:21 PM EST reply actions

My wife is 1/8th Cherokee, and I think that should be enough to allow me to operate a casino out of my house.

"BJ on the BE" - Kierkegaard

by Brett Jones on Feb 24, 2009 1:29 PM EST up reply actions

how bad is stations doing

i ahev heard that they are not going to make it through this years, and then on this site i heard that while they have massive amounts of debt they ar eone of the few companies that can pay it all back. i think if zuffa was smart they could start holding events on a smaller scale like fight nihgts instead of at the pearl at the palm which to me looks like a spruced up high school gym, hpold them at stations and then both companies benefit.

by bearcox13 on Feb 24, 2009 1:34 PM EST reply actions

Station is trying to enter chapter 11 restructuring to lower their debt load, they are still making money just not enough to cover all the debt they took on when they went private in 2007. Their position as the local casinos and destination resorts for bargain shoppers would of allowed them to ride this out if it wasn’t for their huge debt load. Still I am surpised to see any casino company with the funds to make huge purchases currently, Station could sell all or part of it’s holdings here.

As far as Zuffa and Station working together they have made a serious effort to have the two not work together at all, I don’t think they even have after parties for events at Station properties. I don’t know why they work to keep them separate (perhaps it has to do with their gaming license) but they do seem to have their reasons.

by who me on Feb 24, 2009 1:52 PM EST up reply actions

I believe some of this came up back in the days when the PRIDE vs. UFC lawsuit came about, and the whole Xyience debacle was on the table.

I can’t recall specific conversations I had or specific points as it has been a long time, but it came up a few times that keeping them seperate is much easier business wise. I know that when the entire process of buying PRIDE came about, due dilligence was a huge issue. Furthermore, since the Fertittas were involved in the casino business, huge background checks had to be done on the PRIDE management staff because the Fertittas were involved in the casion business… even though this was an acquisition of a fighting organization.

Their link to the gambling industry causes more hassle than not when it comes to business dealings within Zuffa. I believe the commission regulating gambling can also work investigations into Zuffa held properties as well because of the link.

Editor-in-chief of MMA-Analyst.com

by Leland Roling on Feb 24, 2009 2:16 PM EST up reply actions

good call

nothing on this planet is worse than dealing with beckround checks involved in getting government licensing on anything anyone cares about.

by bearcox13 on Feb 24, 2009 2:42 PM EST up reply actions

Makes sense. I also wonder if there is an issue with the fact that casinos take bets on MMA fights too. I’d imagine that Station doesn’t do betting on UFC events at all and probably wants to stay as clear as they can away from any kind of percieved conflict of interest involving their gaming license.

by who me on Feb 24, 2009 3:44 PM EST up reply actions

If I am recalling correctly, when due dilligence was being brought up in the PRIDE buyout investigation, the reason the Gaming commission was interested in the investigation was because background checks were not done on the PRIDE officials, which led to allegations of organized crime getting in bed with men linked to the casino business. It was all speculation at the time, but that’s the link there. Hence why it went from buying a Japanese fight promotion to much, much more.

Editor-in-chief of MMA-Analyst.com

by Leland Roling on Feb 24, 2009 3:52 PM EST up reply actions

Take The Money

Chapter 11 or selling off a bad deal? Mmm . . . honestly I don’t know if that is bad offer or not but that’s good news that there is an interested buyer.

by bignerd on Feb 24, 2009 2:28 PM EST reply actions