Friday, March 12, 2004
Copyright © Las Vegas Review-Journal

Casino purchase finally finished

Oft-delayed deal for Horseshoe ends for Harrah's, MTR

Harrah's Entertainment and MTR Gaming Group completed their long-delayed buyout of Binion's Horseshoe on Thursday, setting the stage for an April 1 reopening and the World Series of Poker's final run at the landmark downtown property, Harrah's spokesman David Strow said.

Chester, W.Va-based MTR Gaming Group is buying the 52-year-old downtown landmark for about $20 million. Harrah's will retain the poker tournament and rights to the Horseshoe brand name in Nevada for the remainder of what has been estimated to be a $50 million deal.

The three-way agreement also calls for Harrah's to operate the Horseshoe for at least one year, with options to extend the management agreement with MTR for up to two more years.

Former Horseshoe owner Becky Binion Behnen declined to comment on the deal's closure Thursday, but Jerry DePalma, her attorney, said: "There's a certain amount of sorrow in having to give up the operation to Harrah's, but Becky has said she's pleased a solid operator like Harrah's is taking over.

"It's a very sad moment in her life. (The Horseshoe is) something that has been built by her father's and mother's hard work, but she's pleased 1,000 workers will be going back to work."

As part of the operating agreement, Harrah's is set to start the World Series of Poker's 35th anniversary season April 22 with a casino employees-only opening event. The 33 separate public events in the tournament will start April 23 and run for five weeks through May 28.

However, Harrah's is planning to move the internationally renowned poker tournament to another of its properties in Las Vegas in 2005, except for the final two playoffs.

During a tortuous path to complete the deal the past several weeks, Harrah's made a public commitment to the city to hold the World Series of Poker at the Horseshoe through the city's centennial next year.

Mayor Oscar Goodman had threatened to block the transfer of the property's liquor license without the commitment in place, something he called a "deal-killer."

University of Nevada, Las Vegas professor Hal Rothman said moving the poker tournament out of downtown Las Vegas was an appropriate concern of the mayor and its venue should be of equal concern now to public officials.

"The World Series of Poker has become a signature event for downtown. It's a necessary part of building a downtown and the future. Officials are rightly upset about losing all the cachet it brings to downtown Las Vegas," Rothman said.

Meeting such objections to moving the tournament, Harrah's Western division President Tom Jenkin, who will oversee the Horseshoe, announced on March 5 that the downtown casino will host the 2004 tournament and that the final two rounds of the 2005 tournament will be held downtown.

That promise led the City Council to vote unanimously to approve transfer of the liquor and business licenses for the hotel-casino, home to the tournament for the past 34 years.

The 5-0 vote ended two days of discussion and posturing by Goodman and Harrah's officials over the fate of the world's top poker tournament.

Goodman said Thursday he got what he wanted from the negotiations, that the Horseshoe name will still be on the building through 2005 and that the final two sessions are the most important because they will be televised.

This year's tournament will be conducted entirely at the Horseshoe, but 31 out of the tournament's 33 events next year, starting in mid-April and running through late-May, will be moved to Harrah's Las Vegas or the Rio, the other two properties the company operates in Las Vegas, Strow said.

With completion of the Horseshoe sale, he said both MTR and Harrah's are moving ahead to reopen the downtown landmark.

"Today, we're just continuing to interview employees because we're going to need them back at work pretty soon," Strow said.

Culinary Local 226 chief D. Taylor said he had been confident Harrah's would get through the many twists in closing the deal, including legal haggling over the title to two parcels under the Horseshoe, and just as sure "it'll be up and running if not by April 1, then April 2 or 3."

He cautioned, however, that union members who have been notified by Harrah's that they should schedule interviews to be rehired do not need to because they will just be recalled when the reopening takes place.

Harrah's is planning to make about $1 million in improvements to the property before it reopens, no later than early April.