Legends' Bankruptcy Sale Crumbles

Deal to sell casinos falls apart

By Mike Nolan mnolan@southtownstar.com

February 1, 2013

 

The sale of casinos in Louisiana and Mississippi — operated by a company controlled by a Homer Glen man — to an Oklahoma Indian tribe has apparently unraveled, according to court documents.

Legends Gaming had filed for bankruptcy last August and announced it was selling its DiamondJacks casinos in Bossier City, La., and Vicksburg, Miss., to Global Gaming Solutions. At that time, the deal was valued at $125 million.

William McEnery, the former owner of the Gas City chain, is Legends’ chairman, chief executive officer and majority shareholder.

 

Legends’ plan for emerging from bankruptcy hinged on selling substantially all of its assets to Global Gaming, a subsidiary of the Chickasaw Nation.

 

In a bankruptcy court filing on Wednesday in Louisiana, Legends alleges that Global Gaming has breached the terms of the sale agreement, and that Global “has clearly indicated that it has no intention of closing the purchase of the assets.” Legends said that, as a result, it was withdrawing its pending plan for exiting bankruptcy.

 

In a response filed Thursday, Global Gaming insisted it hadn’t violated any terms of the agreement and “has met all of its obligations.” Global said it had been moving forward with getting approval from regulators to take control of the two casinos.

 

McEnery’s Gas City locations were sold following a separate bankruptcy case, and his personal bankruptcy case is continuing in federal court in Chicago.

 

http://southtownstar.suntimes.com/business/17954870-420/deal-to-sell-casinos-falls-apart.html

 

 

Legends Gaming Files 2nd Bankruptcy

Legends Gaming, bankrupt owner of La. and Miss. casinos, to sell to Chickasaw Nation of Okla.

By Associated Press, Published: August 3AP

VICKSBURG, Miss. — The owner of casinos in Vicksburg, Miss., and Bossier City, La., has filed for bankruptcy and plans to sell its casinos to an Oklahoma Indian tribe.

Legends Gaming filed Monday for Chapter 11 bankruptcy reorganization in Shreveport, La. The company plans to sell its DiamondJacks casinos to Global Gaming Solutions for $125 million, said Kym Koch, a spokeswoman for Global Gaming.

The bankruptcy court and state gaming regulators must approve. Legends has the right under the sale agreement to seek buyers willing to pay more. If multiple bidders emerge, the bankruptcy court could hold an auction.

Global Gaming is owned by the Chickasaw Nation of Oklahoma. The company bought Remington Park Racing and Casino in Oklahoma City in 2010 and bought Lone Star Park in Grand Prairie, Texas, in 2011. The tribe also owns 13 casinos in Oklahoma’s highly competitive Indian casino market.

Though tribes in Louisiana and Mississippi operate casinos outside the state regulatory structure, officials said Global Gaming would be regulated and taxed just like any other non-Indian casino owner.

“They would be subject to the oversight of the State of Mississippi just like DiamondJacks is (now) and all the tax liabilities would be the same,” Allen Godfrey, executive director of the Mississippi Gaming Commission, told the Vicksburg Post (http://bit.ly/PrWWUg).

Louisiana officials told The Times in Shreveport (http://bit.ly/MD8Trm ) that Global Gaming would face a background investigation like any new casino owner in the state.

In its bankruptcy filing, Legends listed assets between $50 million and $100 million and liabilities between $100 million and $500 million. Moody’s Investors Service said Legends has as much as $163 million in debt due in 2014.

Legends, which also filed for bankruptcy in 2008 said no workers will be laid off and that the casinos will continue to operate as usual.

“Our team members are essential to our future success, and should see no difference in their jobs,” Legends Chairman and CEO William McEnery said in a statement. “We believe that we have found a buyer who will continue DiamondJacks’ commitments to the communities in which we operate as well as to its most valued asset, our team members.”

DiamondJacks is typically last among Bossier City’s five casinos in terms of revenue, according to Louisiana state figures. Mississippi doesn’t release revenue figures for individual casinos, but DiamondJacks has the second-largest number of slot machines among Vicksburg’s four casinos. A fifth Vicksburg casino, Grand Station, closed in March amid its own bankruptcy.

DiamondJacks employs 364 people at its casino and hotel in Vicksburg, according to Mississippi figures. It employs about 650 people in Bossier City, according to Louisiana figures.

Both properties were the first casino in their respective cities when opened by the Isle of Capri. Vicksburg opened in 1993 while Bossier City opened in 1994. Isle of Capri sold the gambling halls to privately-held legends in 2006. Legends first filed bankruptcy in 2008 to lower interest rates on $215 million in borrowed to finance the purchases.

http://www.washingtonpost.com/lifestyle/travel/legends-gaming-bankrupt-owner-of-la-and-miss-casinos-to-sell-to-chickasaw-nation-of-okla/2012/08/03/c5bb1006-ddac-11e1-8ad1-909913931f71_story.html

Criminal case an issue in Kansas casino decision

Criminal case an issue in Kansas casino decision

TOPEKA, Kan. (AP) — A criminal case in Iowa became a complication Wednesday for a Kansas board that will pick a developer for a state-owned casino south of Wichita because misdemeanor charges are pending against two top executives in one of the two rival applicants.

But one of the executives said he and his colleague are ready to step away from their company's Kansas project if they're convicted of misdemeanor campaign finance violations in Iowa, though both men have pleaded not guilty.

The Kansas Lottery Gaming Facility Review Board is reviewing competing proposals from Peninsula Gaming, based in Dubuque, Iowa, and Global Gaming Solutions, of Ada, Okla., which is owned by the Chickasaw Nation. Kansas law allows only one casino in the Wichita area, and the review board plans to pick an applicant Dec. 15.

Supporters of Global's proposal suggest the legal problems facing two Peninsula executives in Iowa should disqualify that company. Brent Stevens, its chief executive officer, and Jonathan Swain, its chief operating officer, were charged in October with two misdemeanor counts each of violating Iowa's campaign finance laws.

"We strongly deny any wrongdoing," Stevens told the Kansas review board. "We're looking forward to a positive resolution of this matter. We're looking forward to it very, very soon."

The charges against the two executives involve accusations their company made donations in the name of others to Democratic Iowa Gov. Chet Culver's unsuccessful re-election campaign.

Each executive faces one count of making a contribution in the name of another and one count of failing to disclose a contribution. They're scheduled to go to trial Jan. 5 in Polk County District Court but have asked for a 60-day delay, with their attorney saying he needs more time to take statements and evaluate evidence.

Stevens sought to reassure the review board that even if he and Swain stepped away from the Kansas project because of the case, the company has a "very, very deep bench" that would allow it to complete the project.

"We've succeeded by doing the right thing, time and time again. We operate at the highest level," he said. "It will be built."

Kansas review board members struggled with how the criminal case should affect their decision. One consultant hired by the board said Kansas officials have to consider it in deciding whether Peninsula's project should go forward rather than Global's.

But review board Chairman Matt All said such issues are better left to the Kansas Racing and Gaming Commission, which will check the background of any successful applicant and regulate the casino.

"We just want to make it fair," All said of the selection process. "We're not qualified to take up those issues."

The rights to the new gambling and the equipment at the casino will be owned by the Kansas Lottery, and the state will receive 22 percent of the revenues.

The criminal case complicates the review board's work because, even if it picks Peninsula, the Racing and Gaming Commission, as the regulator, must sign off after conducting a background check. Consultants hired by the review board have projected that Peninsula's project would generate more revenue because its site is closer to Wichita.

Peninsula wants to build its $260 million project near Mulvane, about 18 miles south of Wichita, while Global Gaming's site for its proposed $280 million complex is near Wellington, another 14 miles to the south. The casino must be in Sumner County because voters in neighboring Sedgwick County, home to Wichita, rejected the idea.

The board's consultants suggested revenues at the Wellington site would be three-quarters or less of the revenues at the Mulvane site. But John Elliott, Global Gaming's CEO, said the analyses were flawed and questioned the assumption that the extra distance from Wichita would make more than a negligible difference.

"We refute the suggestion of a significant difference in revenue," Elliott said. "The issue here is that the distance isn't great."

Elliott didn't mention the criminal case involving Peninsula executives in Iowa, but on Tuesday, the chairman of the Sumner County Commission did in a statement praising Global's proposal, which the commission has endorsed.