Inside Gaming: Icahn Sells Properties, Hard Rock Atlantic City Announces Opening
In this week's Inside Gaming, industry mogul Carl Icahn is selling off his casinos, we now know when the Hard Rock Atlantic City will open its doors, Pennsylvania appears to have exhausted in-state interest in bidders for "mini-casino" licenses, and a casino gets hacked via the aquarium in the lobby (no shinola!).
Carl Icahn Sells Most of His Tropicana Casinos
Billionaire investor Carl Icahn appears to be stepping away from the casino game. This week a deal was announced in which his Icahn Enterprises would sell the majority of its Tropicana Entertainment properties to Gaming and Leisure Properties for a price tag of $1.85 billion, Reuters reports.
The deal includes six of eight casino properties currently run by Icahn's company. Eldorado Resorts will take over operations of those casinos for Gaming and Leisure Properties, with Eldorado to contribute $640 million of the payment in order to lease the properties for 15 years.
Among the casinos included in the deal are the Tropicana Atlantic City in New Jersey, and both the Tropicana Laughlin and MontBleu Resort Casino & Spa in Nevada. In a statement Icahn Enterprises noted "the deal did not include the company's Aruba casino," the Tropicana Aruba, "which would be sold separately as a condition of closing the deal."
In late August Icahn sold the unfinished Fontainebleau Las Vegas to New Valley LLC for $600 million, with the sale netting Icahn a $450 million profit. That was a much better deal for Icahn than was his post-closure sale of Trump Taj Mahal, a property he had previously helped out of bankruptcy in early 2016 when he made Trump Entertainment Resorts a subsidiary of Icahn Enterprises, thereby assuming the last 10 percent ownership of the property from Icahn's friend President Donald Trump.
Filings showed Hard Rock International paid $50 million for the property in March 2017, not quite the $300 million originally reported.
Hard Rock Atlantic City Announces Date for Grand Opening
Speaking of the Hard Rock International's purchase of the shuttered Trump Taj Mahal, this week came an update regarding the planned-for opening of the new Hard Rock Hotel & Casino Atlantic City on that site.
Previously the target had been a Memorial Day weekend opening, but on Wednesday we learned the grand opening is now scheduled for June 28.
As PlayNJ reports, the announcement came during a press conference in New York City simultaneously relayed both to the Tanger Outlets in Atlantic City and the Hard Rock Cafe Philadelphia.
During the presser, Matt Harkness, president of Hard Rock Atlantic City, commented on the extensive renovations in progress at the property. "Every inch of the building is going to be completely redone... including the exterior. People won't recognize the look of the place," said Harkness.
An artist's rendering of the new property (pictured above) helps confirm Harkness's comment, as anyone who recalls how Trump Taj Mahal occupied that space previously can attest.
Along with improvements to rooms and the casino, the Mark G. Etess Arena for live concerts is also being expanded and renovated, with an extensive Summer Concert Series announced as well at the press conference.
No Bidders Step Up in PA for Sixth "Mini-Casino" Auction
In this space we've been occasionally looking in on the ongoing auctions for "mini-casino" licenses in Pennsylvania that began in January. The state passed newly expanded gaming legislation last fall that besides opening the door to online gaming also allowed for 10 new "satellite" casinos to open alongside the 12 casinos already operating in the state.
When auctions for mini-casino licenses began, lawmakers had hoped to raise at least $100 million from the bids, and in fact it only took three such bids to cross that mark — from Penn National Gaming (for $50.1 million), Stadium Casino LLC (for $40.1 million), and Mount Airy Casino Resort (for $21.2 million).
There was a bit of a hiccup surrounding the fourth bid when a winning $9.9M bid from Sands Bethworks Gaming, LLC, owner of the Sands Casino Resort Bethlehem was nixed because the Sands' bid intruded on an area already claimed by Mount Airy. Greenwood Gaming and Entertainment Inc. was subsequently awarded the fourth license for its bid of $8.1 million. The fifth auction was then won with a just-over-the-minimum bid of $7,500,003 that secured Penn National a second license.
Now it appears no other in-state casinos are interested enough to bid $7.5 million, as this week's auction came and went with no one offering up that minimum set by lawmakers. As the Associated Press reports, the Pennsylvania Gaming Control Board now faces a decision whether or not to open the bidding to out-of-state operators or other non-casino businesses.
High-Roller Database Hacked Via Aquarium Thermostat
Finally, one more industry-related item to share with you via Business Insider, a story of hackers having once figured out a way to breach a casino's security by a novel means — via a "smart" thermostat used to regulate the water temperature in an aquarium installed in the lobby.
While the casino isn't identified in the article, there is an interesting summary of the explanation provided by Nicole Eagan, CEO of the cybersecurity firm Darktrace, to a London conference last week of how the hackers were able to access a database listing the casino's high-stakes players.
"The attackers used [the aquarium thermostat] to get a foothold in the network," said Eagan. "Then they found the high-roller database and then pulled that back across the network, out the thermostat, and up to the cloud."
Bottom line — the ever-increasing integration of systems' software to manage devices (a.k.a., the "internet of things") can likely increase the potential for vulnerabilities for all businesses, including casinos.
Image: Hard Rock Atlantic City.
