Wynn battle with Okada seen as hindrance to Japan casino bid

Steve Wynn’s fight with Japanese businessman Kazuo Okada may not only cost him steep legal fees.

It could hamper the Las Vegas billionaire’s chances to win a major casino license on the Asian island nation, according to research firm Morningstar.

Wynn is vying against local competitors Las Vegas Sands and MGM Resorts International for what is expected to be two Japanese urban gaming licenses. Those licenses may be auctioned off by the end of 2019. With more than $20 billion in gaming and nongaming revenue up for grabs, the jockeying for the first two positions will be fierce.

Japanese government officials will award the licenses based on a number of factors, including a casino operator’s history of working with partners, convention footprint and financial health, Morningstar wrote following meetings with 25 professionals involved in the process.

Wynn ousted Okada as vice chairman of Wynn Resorts in 2012 and redeemed his stake in the Las Vegas-based casino operator amid accusations the Japanese businessman bribed Philippine officials to win a license. Okada has denied the accusations and countersued Wynn. Their fight is still ongoing.

Small global presence

The Okada saga may not be Wynn’s only hill to overcome in winning the license. Wynn Resorts has a smaller meetings, incentives, conventions and exhibitions (MICE) presence than its peers. Wynn operates about 400,000 square feet of meeting and convention space globally while Sands has more than 5 million and MGM more than 3 million.

“While Wynn Resorts has a successful track record of constructing and operating luxury resorts, its involvement with bribery litigation, along with its weaker MICE (Meetings, Incentives, Conventions and Exhibitions) and balance sheet position relative to MGM and Sands, leads us to believe that the company is unlikely to receive one of the two urban gaming concessions in Osaka and Yokohama.”

Wynn Chief Marketing Officer Michael Weaver dismissed Morningstar’s concerns over the Okada spate.

”We don’t believe that will be a factor at all,” said Weaver.

Union Gaming analyst John Decree agreed, saying there ”will be far more important criteria in awarding the gaming licenses.”

Sands and MGM have the best chance among international operators because of their significant MICE exposure and experience operating in heavily regulated gaming in markets like Las Vegas and Singapore, a model for the Japanese government, according to the research firm. Only Sands has a resort in Singapore.

“Japan appears to hold Singapore’s regulatory structure of controlling gambling addiction and preventing potential money-laundering in high regard,” Morningstar said.

Regulation Timeline

The Japanese Parliament last year passed the first of two key bills required to legalize full-scale resorts.

Las Vegas operators are not united on whether the second bill, known as the Implementation Act, will be approved before the end of the year.

The second bill will stipulate key aspects of the new industry, such as the total number of licenses to be awarded, resort locations, gambling tax regime and level of foreign participation.

The Parliament must first agree on gambling addiction legislation before it can approve the second bill. The research firm expects the addiction legislation to be approved late this year with the second bill passed next year.

Getting the addiction legislation cleared up this year ”would be a good sign of progress,” said MGM Executive Vice President Alan Feldman.

Morningstar anticipates four licenses will be awarded, including two major cities and two regional locations. Global industry players, including Las Vegas-based operators, may only vie for the urban licenses.

Osaka, located 300 miles southwest of Tokyo, will likely be chosen by the government because a full-scale resort could help turn around its struggling economy, the brokerage said. Yokohama will likely win due to its close proximity to Tokyo.

Costs, Foreign Ownership Limits

Tokyo is facing spiraling construction costs as it prepares for the 2020 Summer Olympics, lowering its chances of being chosen, Morningstar wrote.

Investment in the urban resorts could reach $10.5 billion each, according to Morningstar. That would be more than double the $4.2 billion for The Cosmopolitan of Las Vegas, the most expensive resort ever built in Las Vegas. Sand’s Marina Bay in Singapore opened in 2010 at a cost of $6 billion.

MGM’s Feldman said $10 billion is a reasonable estimate for the cost of a full-scale resort in Japan.

Sands spokesman Ron Reese pointed out Chief Executive Officer Sheldon Adelson commented he would be willing to invest $10 billion in a Japanese gaming resort.

However, the Japanese government is highly unlikely to allow foreign companies to develop a full-scale resort on their own. Foreign operators may be limited to a 33 percent stake in a resort consortium, limiting their investment to $3.5 billion, according to Morningstar.

Japanese full-scale resorts could open as early as 2024 and generate as much as $21 billion in gaming revenue, according to Morningstar. That would make it the second-largest gaming market in the world after Macau, which is on track to generate $30 billion in revenue this year.

The Review-Journal is owned by the family of Las Vegas Sands Corp. Chairman and CEO Sheldon Adelson.

Contact Todd Prince at tprince@reviewjournal.com or 702-383-0386. Follow @toddprincetv on Twitter.

Three takeaways from Wynn Resorts' Earnings Call
Matt Maddox came out swinging in his first earnings conference call as Wynn Resorts chief executive officer, boasting of record Las Vegas quarterly revenues and applicants lining up for work.
Star Wars VR Comes to Las Vegas
Sneak peak at the new "Star Wars: Secrets of the Empire" VR experience at the Grand Canal Shoppes.
Elaine Wynn continues her fight to change Wynn Resorts board
Elaine Wynn, the largest shareholder of Wynn Resorts Ltd., is seeking to kick a friend of her ex-husband Steve Wynn off the company’s board of directors. (Todd Prince/Las Vegas Review-Journal)
Zillow is getting into house flipping in Las Vegas
Las Vegas Review-Journal real estate reporter Eli Segall says flipping houses has waned in popularity after the housing bubble burst.
Ellis Island Buys Mt. Charleston Lodge
Ellis Island, which operates a casino, brewery and hotel just off the Strip, purchased the Mt. Charleston Lodge in early April.
Casinos to be penalized for allowing drug-impaired customers to gamble
Nevada Gaming Commission Chairman Tony Alamo talks about an amendment making casinos subject to the same disciplinary standards of preventing people to gamble if impaired by drugs as they are for letting them play while intoxicated by alcohol.
Terrible Herbst to open large travel center in Southern Nevada
The 50,000-square-foot commercial travel center will include 96 fuel pumps and the third White Castle restaurant in Southern Nevada. Wade Tyler Millward reports.
Art Bell’s Top 10 Shows
A selection of radio host Art Bell’s most popular shows.
Hooters owner talks about room upgrades at his hotel-casino
George Ruff, founder and senior principal of Trinity Hotel Investors L.L.C., owner of Hooters Hotel and Casino in Las Vegas, talks about recent room upgrades at the hotel. K.M. Cannon/Las Vegas Review-Journal
Passengers Discuss Allegiant Air
Allegiant Air passengers voice their views on the airline at McCarran International Airport on April 16, 2018. (Bailey Schulz/Las Vegas Review-Journal)
Longtime Las Vegas attorney John Momot dies at age 74
Criminal defense attorney John Momot, who represented mob figures and even played himself in the movie “Casino,” has died.
Trump Slams Amazon for Not Paying Enough in Taxes
Trump Slams Amazon for Not Paying Enough in Taxes Trump tweeted his concerns about the company on Thursday. This isn't the first time Trump commented on the issues via Twitter. August 2017 December 2017 Amazon did hold back on paying state taxes in 1995, but the company has been routinely collecting state sales taxes since then. In 2016, the company's report from the Securities and Exchange Commission confirmed it paid $412 million in taxes.
David Copperfield in court after man injured during magic trick
The attorney for a British man who is suing illusionist David Copperfield said his client suffered serious injuries after being called on stage during Copperfield's show at MGM Grand.
eyecandylab CEO shows augmented reality during NAB
Robin Sho Moser, CEO and co-founder of eyecandylab gives an augmented reality demonstration at his booth during the National Association of Broadcaster Show at the Las Vegas Convention Center. K.M. Cannon/Las Vegas Review-Journal
Trends in access to capital for local black business owners
Denette Braud, owner of Braud’s Funnel Cake Cafe, talks about what owning her own business means to her.
Sir Richard Branson announces purchase of Hard Rock Hotel
Sir Richard Branson, founder of the Virgin Group, has acquired the Hard Rock Hotel with partners and plans to turn it into a Virgin-branded property by the end of 2019.
Calvary Christian Learning Academy, “There was no fair warning.”
Samantha O’Brien, whose three-year-old daughter attended the Calvary Christian Learning Academy daycare, found out Monday night when her daughter’s teacher called about the school closing.
Adobe unveils #HackTheBracket application for March Madness
Adobe unveiled their #HackTheBracket application at the Adobe Summit trade show at Sands Expo. People can use data from Adobe Analytics to make their bracket for March Madness. K.M. Cannon/Las Vegas Review-Journal
Adidas Signs Yankees' Star Aaron Judge
Adidas Signs New York Yankees Star Aaron Judge The slugger is set to don a new set of stripes this season after signing with the apparel company. Aaron Judge Terms of the deal were not disclosed. The deal includes branding on his batting gloves and wristbands. Judge, the AL's reigning Rookie of the Year, was previously under contract with Under Armour since 2014. Judge won the American League Rookie of the Year award last season after setting an MLB record for most homers in a rookie season (52).
Esports athletes are sponsored, too
Meet Red Bull-sponsored professional esports player Daryl S. Lewis, better known by his in-game name Snake Eyez. Nicole Raz Las Vegas Review-Journal.
Bettor Investments turned into a bad bet
Bettor Investments formerly operated a Nevada-licensed entity betting operation. The company promised “conservative growth, profits and stability for our investors.” Matt Stuart, who ran the fund, shut it down in late 2016 and never made good on an agreement with shareholders.
Starbucks Will Give You $10 Million for a Better Cup Design
Starbucks Will Give You $10 Million for a Better Cup Design Get your thinking caps on because the company is looking for a new cup that's easier to recycle. The $10 million grant challenge sees Starbucks partnering with investor group Closed Loop Partners for the project. According to CNN Money, Aside from the new cup design challenge, Starbucks stated it will test a cup with an inner lining made from plant fibers to prevent hot liquid from leaking. Will you join the challenge for #Bettercups?
Las Vegas bartenders who worked the Route 91 Harvest Music Festival question what they were paid
Reneé Black, left, and her husband Griffin Black talk to the Review-Journal at their home in Las Vegas, Tuesday, March 6, 2018. Reneé was a bartender at Route 91, and Griffin was a bar back. They were hired as independent contractors, but received forms months later indicating they were employees. They also were never paid their last day of tips. Nicole Raz/Las Vegas Review-Journal.
Bad-beat jackpot money will finally be awarded
People who thought they had won in Station Casinos’ “bad beat jackpot” poker promotion were unhappy. They waited months to get paid. And now the bad-beat jackpot is gone.
New developments coming to Las Vegas' Craig Road
Gina Gavan, economic and business development director for North Las Vegas, discusses new development projects on Craig Road in North Las Vegas. Art Marroquin/ Las Vegas Review-Journal
Companies bet their futures on cryptocurrency
Two Las Vegas entrepreneurs talk about finding their niche in blockchain enabled technologies and digital currency.
Solar panels reduce energy bill for CCSD
Wilbur and Theresa Faiss Middle School is one of 42 CCSD schools with solar panel installations, saving approximately $514,000 per year in energy costs.
Dallisa Hocking And A Grandmothers Psychic Gift
Dallisa Hocking’s new “boutique soul center” pays tribute to her late Grandma Ellie. (John Przybys/Las Vegas Review-Journal)
Can't pay the IRS? You do have options
There's a little more than five weeks until this year’s tax filing deadline of April 17. But many small business owners are wondering, “How am I going to pay my taxes?” When owners haven’t set aside enough money to cover what they owe the government, they have options. — The easiest and cheapest alternative may be to dip into personal savings. — If you have available credit, you may want to borrow from a lender or credit card. — Also, the IRS can work out an installment payment plan.
Amazon Offering Discounted Prime Memberships to Medicaid Recipients
Amazon Offering Discounted Prime Memberships to Medicaid Recipients Individuals with a valid Medicaid or Electronic Benefits Transfer (EBT) card The $5.99 membership can be renewed every year for up to four years. The reduced Prime membership comes with the same benefits of a standard one, including free two-day shipping, Prime Video, Prime Music and Prime Now. Last year, Amazon also joined a USDA pilot program that allows those receiving government assistance through the Supplemental Nutrition Assistance Program to buy groceries through online markets like Amazon's FreshDirect or Walmart.
News Headlines
Home Front Page Footer Listing
You May Like

You May Like