Published Wednesday, Sept. 1, 2010 | 11:53 a.m.
Updated Wednesday, Sept. 1, 2010 | 1:22 p.m.
The state Gaming Control Board today recommended approval of the licensing of the company that once owned the shuttered Lady Luck casino in downtown Las Vegas.
Virginia McDowell, president and chief operating officer of St. Louis-based Isle of Capri Casinos Inc., told board members today that her company plans to enter the Nevada gaming market and will seek opportunities to develop a presence in Las Vegas.
The board, missing Chairman Dennis Neilander, voted to recommend the licensing to the Nevada Gaming Commission, which is expected to consider the matter at its Sept. 16 meeting. The licensing recommended today would enable Isle of Capri to acquire a 0.1 percent interest in Fernley Pioneers LLC, which operates a small casino in Fernley, east of Reno.
But the long-term big picture for the company is to get into the Las Vegas market.
McDowell told regulators that Isle of Capri, which operates 15 casinos in six states, would be best suited to operate a locals property in Las Vegas. The company recently was under consideration to manage four Station Casinos properties that were proposed to be spun off as part of the Station Casinos’ bankruptcy settlement. It turned out that Station management maintained control of its properties and the Isle management proposal never occurred.
Isle also was licensed and owned the downtown Las Vegas Lady Luck property in 2000, selling its interest in 2002. After two ownership changes, the most recent holders of the Lady Luck, Los Angeles-based CIM Group, closed the property in 2006.
McDowell said the company decided to sell the Lady Luck “because it was not a part of our core competency.” But after investigating the market when under consideration to run the four Station properties, the company decided it wanted to be in Las Vegas. She said a survey of her customers indicated that 80 percent of them visit Las Vegas at least once a year and it made sense for the company to have a local presence.
“It’s the ultimate gaming destination,” McDowell said of Las Vegas.
Isle was founded in 1992 by Bernard Goldstein, considered the father of modern riverboat gambling in the United States and who died in 2009. The company now operates properties in Florida, Louisiana, Missouri, Mississippi, Iowa and Colorado. McDowell said the company, which once had interests in foreign countries, is working to become strictly a domestic operation.
McDowell said she believes the downturn in gaming is directly attributable to high unemployment rates and she thinks as more people become employed, gaming revenue will increase.
“We believe it’s a cyclical business and when the cycle turns, we want to be ready for the opportunity,” she told regulators.
Isle operates its properties under the Isle of Capri and Lady Luck brands in most markets, but it does not own the rights to the Lady Luck brand in Nevada. She said any acquisition would likely take on the Isle of Capri name, but she also noted that if an opportunity to manage a property occurred, it would likely keep the existing name.
In other business, the Control Board delayed action on a request to remove an individual from the Nevada Gaming Commission’s list of denials, revocations and unsuitability findings. The board also recommended approval of the licensing of MGM International executive Dan D’Arrigo as a key executive.
Board members Mark Lipparelli and Randall Sayre opted to delay action on a request from John Bertolero to be removed from the commission’s so-called “gray list” of denied applicants. By law, licensed companies can’t conduct business with individuals on the list.
Bertolero was placed on the list in 1980 after his involvement slot-machine rigging and blackjack cheating incident, regulators said.
Because the matter involves a removal from the list, Lipparelli and Sayre opted to delay action for a month to include Neilander, who was absent due to a family matter, in the debate.
D’Arrigo, who serves as treasurer of MGM Resorts International, was recommended for licensing. During his presentation, D’Arrigo said his company continues to undertake a slow recovery in the midst of the recession.
D’Arrigo said revenue per available room was up year over year in June for the first time since 2007 and the company’s 2011 convention calendar – probably the longest-term leading indicator for future business – is showing favorable trends.
“I guess you can say things are less bad than they were,” D’Arrigo told the board.