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Control Board recommends approval for Apollo’s acquisition of Venetian

Updated February 3, 2022 - 6:58 am

Apollo Global Management Inc. moved a step closer to acquiring The Venetian, Palazzo and The Venetian Expo from Las Vegas Sands Corp. on Wednesday when it received unanimous approval from the Nevada Gaming Control Board.

The Control Board spent more than two hours collecting testimony from David Sambur, co-head of private equity for Apollo, and Venetian President and Chief Operating Officer George Markantonis, who will be the CEO of the new subsidiary operating the property.

The Control Board’s recommendation will be considered for final approval by the Nevada Gaming Commission on Feb. 17. The deal is expected to close after Gaming Commission approval.

Apollo, Sands and Vici Properties Inc. first announced the deal in March. Under its terms, Apollo, a New York-based private investment company founded by real estate investor and former CEO Leon Black, would pay $1.05 billion in cash and $1.2 billion in seller financing in the form of a term loan credit and security agreement.

New York-based Vici, a real estate investment trust affiliated with Caesars Entertainment Inc., is paying $4 billion in the transaction and will hold the Venetian real estate.

Sands is exiting the Las Vegas market, believing that the company’s financial future rests with its investments in Macao, where it is the market leader, and Singapore. The company also is focused on other domestic investments in the United States, with prospects in New York, Florida and Texas.

Regulators get insight into plans

On Wednesday, regulators received details on Apollo’s plans for the resort, the company’s previous ownership of Caesars Entertainment Inc. in the late 2000s and the relationship Black has with the company.

Markantonis told regulators that Apollo will retain the nucleus of The Venetian’s management team and that he expects all employee pay and benefits programs to remain as part of the hotel’s culture going forward.

The company anticipates meetings and convention industry operations — a core of The Venetian business plan — will strengthen and provide growth opportunities as business rebounds after the pandemic.

Sambur also noted new opportunities await once the MSG Sphere at The Venetian, a 17,500-seat entertainment venue adjacent to The Venetian Expo, is completed in 2023.

Regulators also inquired about one of Apollo’s earlier Strip property ownership experiences.

No strangers to gaming

Apollo acquired Caesars Entertainment Corp. in 2008 at a time when the Great Recession was taking hold. When Apollo took control, it invested $2.4 billion into Caesars’ Las Vegas operations, including renovating parts of Caesars Palace, turning the Imperial Palace into The Linq Hotel with a large retail complex, buying Planet Hollywood and turning the-then Barbary Coast into The Cromwell.

Sambur said the Caesars deal never stood a chance “and we were digging ourselves out of a hole from the start.”

Apollo exited the market in 2019 after Caesars filed for Chapter 11 bankruptcy protection, clearing the way for the current Caesars ownership group headed by the Carano family of Reno to take over.

Board member Phil Katsaros said the bankruptcy issues with Caesars didn’t worry him because the transaction with Sands is so different. While The Venetian deal is occurring during a global pandemic, there are indications that the local market has rebounded faster than anybody anticipated, as evidenced by record gaming win by casinos in 2021.

Sambur was also questioned about the status of Black, the former Apollo CEO.

Black resigned as CEO nearly a year ago after it was disclosed he had associations with convicted sex offender Jeffrey Epstein. While Black still holds an 11.9 percent interest in Apollo, he has no controlling interest in the company and board members concurred that Black’s association with the company was not a problem.

Apollo has other interests in the gaming industry. It recently acquired Lottomatica, an Italian lottery operation, from IGT, and Great Canadian Gaming Corp., which operates 25 casino properties in Canada. Apollo also is invested in Las Vegas gaming equipment operator PlayAGS and was an investor in the Aliante Casino in North Las Vegas when it was restructured prior to its acquisition by Boyd Gaming Corp.

Sands committed to Las Vegas

As for Sands, the board unanimously recommended the company be allowed to deregister as a publicly traded company in Nevada. Once the transaction closes, the company will relocate around 300 executives from The Venetian to an office in southwest Las Vegas.

During the hearing, Sands Chairman and CEO Rob Goldstein reflected on the company’s more than 25-year association with Las Vegas and the industry changes brought about by the late Chairman and CEO Sheldon Adelson.

Goldstein said Sands would continue to be committed to the Las Vegas community once the deal closes.

The Review-Journal is owned by the family of Dr. Miriam Adelson, the majority shareholder of Las Vegas Sands Corp., which operates The Venetian, Palazzo and The Venetian Expo.

A previous version of this story had an incorrect title for George Markantonis.

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter.

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