Spain's EuroVegas plan: US casino operator pulls plug
Proposed $30bn mega-resort outside Madrid abandoned after Spanish government rejects some of Las Vegas Sands demands
Showing posts with label Spain. Show all posts
Showing posts with label Spain. Show all posts
Friday, December 13, 2013
Sands pulls plug on Spain
Eurovegas is off
http://seekingalpha.com/currents/post/1463351?source=email_rt_mc_readmore
- Las Vegas Sands (LVS) decides to pull the plug on its $30B casino project planned for outside of Madrid.
- The company has continually clashed with local and national politicians over the plans for the 6 casinos and 12 hotels which were to be part of Eurovegas.
- Execs say new opportunities in Asia will be explored instead of investing in the massive casino complex in Spain.
http://seekingalpha.com/currents/post/1463351?source=email_rt_mc_readmore
Investors likely to applaud Las Vegas Sands' white flag in Spain
- Shares of Las Vegas Sands (LVS) are on watch after Sheldon Adelson gives up on his vision of a $30B casino complex in Spain.
- Plenty of investors have been clamoring for Las Vegas Sands to stick to its strength of producing impressive returns in Asia and avoid the land of +25% unemployment.
- LVS +1.0% premarket.
Sunday, September 9, 2012
Growing Opposition in Spain
Casino Mogul Sheldon Adelson Plans To Turn Madrid Into The Next Las Vegas
LAS VEGAS (AP) — Casino giant Las Vegas Sands Corp. has chosen Madrid over Barcelona for a multi-billion dollar gambling resort project dubbed "EuroVegas."
The Spanish capital, the country's largest city, emerged as the company's best choice for the development, Las Vegas Sands Chairman and CEO Sheldon Adelson said in a statement released late Friday in Las Vegas.
"The regional government of Madrid has been a strong advocate for this potential development, and we are appreciative of the energy they have brought to this process," Adelson said.
"Barcelona is an outstanding tourism destination, and choosing Madrid over Barcelona was not an easy selection," he said.
The decision was highly anticipated in Spain, where a high jobless rate and a shrinking economy make the prospect of thousands of construction and service jobs attractive to project supporters. But critics predict that gambling will attract criminals and say positions as hotel maids, waiters and blackjack dealers aren't a recipe for success for young people badly in need of jobs.
Adelson has said he wants to invest about $22 billion in the project. The company statement made it clear Las Vegas Sands will allocate no more than 35 percent of that amount.
Adelson has also said he wants Spanish laws changed to let gamblers smoke inside the casinos and new zoning regulations allowing him to send buildings soaring above the skyline.
Company officials called picking a location an important first step toward building a project that is expected to be built in phases over about 10 years. Plans have called for six casinos, 12 hotels featuring 36,000 rooms, a convention center, three golf courses, shopping centers, bars and restaurants.
But not everyone is thrilled about the idea of Spain hosting a European Sin City that could attract prostitution and mafia gangs — and add gambling addiction to the woes of already desperate Spaniards.
Las Vegas Sands Corp. surpassed Caesars Entertainment Corp. last year as the world's largest casino corporation, posting profits of $1.27 billion in 2011. It owns the Venetian and Palazzo resort casinos on the Las Vegas Strip and the Marina Bay Sands in Singapore.
Through its majority-owned subsidiary Sands China Ltd., the company also owns the Venetian Macao and Sands Macao casino resorts, the Plaza Macao hotel, restaurant and shopping complex, and the Sands Cotai Central resort with three hotels and two casinos.
The company's entry into the casino market in the former Portuguese colony near Hong Kong spawned legal battles in Macau and Las Vegas.
A Hong Kong businessman won a $43.8 million verdict in a civil lawsuit filed in Nevada in 2004 claiming he was denied a $5 million "success fee" and 2 percent of net casino profits for helping the company win its Macau gambling license. The Nevada Supreme Court in 2010 ordered a retrial. That case is pending.
A bruising lawsuit filed in 2010 by Sands Macau's former top executive, Steven Jacobs, has drawn interest in the company from U.S. Justice Department and Securities and Exchange Commission investigators for possible violation of the Foreign Corrupt Practices Act. The law bars U.S. companies from paying foreign officials to "affect or influence any act or decision" for commercial benefit.
Jacobs accuses the company and Adelson of breach of contract and of pushing him into illegal activity in Macau. Adelson and the company deny wrongdoing and are vigorously defending the case. No charges have been filed.
Adelson also is a prominent philanthropist and political donor to U.S. Jewish and Republican causes and candidates. He gave $10 million in support of former presidential hopeful Newt Gingrich during his bid for the GOP nomination and has pledged $100 million to Mitt Romney's GOP campaign for the White House.
Read more: http://www.businessinsider.com/sheldon-adelson-madrid-vegas-2012-9#ixzz25ywGoErT
Wednesday, April 11, 2012
U.S. Casinos Get Litigious in China's Macau Region
U.S. Casinos Get Litigious in China's Macau Region
By Sue Reisinger
Corporate Counsel
April 12, 2012
In addition to the glitzy modern casinos Americans have brought to China’s Macau region, they have also imported the corporate lawsuit.
“This can be a startling development for a country, like China, that at one point eliminated all of its lawyers,” said law professor I. Nelson Rose, who runs the website gamblingandthelaw.com.
A global legal expert on gambling, Rose is currently on faculty at Whittier Law School in southern California and teaches gaming law as a visiting professor at the University of Macau. Next week he will be panelist at the annual International Masters of Gaming Law conference in Scottsdale, Arizona, speaking on state vs. federal regulation of Internet gambling.
Rose writes about how U.S. casinos brought lawsuits to Macau in a column for the May issue of Casino Enterprise Management magazine. Like Hong Kong, Macau is one of two special administrative regions in China and has its own legal system.
Rose writes, “The most common suit is by individuals who claim that they should be given a share of what has become a successful company.”
As an example, he cites a suit against Las Vegas Sands Corp. CEO Sheldon Adelson, filed in Nevada in 2008 by a Hong Kong businessman. The man claimed he had introduced Adelson to high-ranking officials in China and paved the way for Adelson’s “concession,” a form of gambling license, in Macau.
The Chinese businessman initially won, but the Nevada Supreme Court overturned the judgment in 2010. The case is set for retrial next year.
And a high-profile case against Wynn Resorts, Limited, has been making headlines recently. It involves ousted Wynn vice chairman Kazuo Okada and his other companies, Aruze USA Inc. and Universal Entertainment Corp.
As part of his suit in January, Okada claims that CEO Steve Wynn gave some $135 million to the University of Macau last fall in hopes of currying favor with the Chinese.
A shareholder derivatives suit soon followed. Rose writes, “We can expect more investigations from the Department of Justice, the Securities and Exchange Commission, and Hong Kong securities regulators.”
Other Macau-related casino suits spotlighted by Rose include:
■In January, Asian American Entertainment sued the Sands, saying the two companies had an agreement to bid for a Macau concession together, according to Rose. The suit claims the Sands breached the contract, and the Asian firm seeks some $375 million damages.
■After Steve Jacobs was fired from running the Sands’ Macau operations in 2010, he filed suit claiming wrongful termination. Jacobs alleged he was fired for refusing to use a Macau attorney who was involved with the government.
Rose writes that the involvement raised “serious questions” about possible violations of the U.S. Foreign Corrupt Practices Act, which forbids corporate payments to government officials in return for favorable treatment. The suit is pending.
By Sue Reisinger
Corporate Counsel
April 12, 2012
In addition to the glitzy modern casinos Americans have brought to China’s Macau region, they have also imported the corporate lawsuit.
“This can be a startling development for a country, like China, that at one point eliminated all of its lawyers,” said law professor I. Nelson Rose, who runs the website gamblingandthelaw.com.
A global legal expert on gambling, Rose is currently on faculty at Whittier Law School in southern California and teaches gaming law as a visiting professor at the University of Macau. Next week he will be panelist at the annual International Masters of Gaming Law conference in Scottsdale, Arizona, speaking on state vs. federal regulation of Internet gambling.
Rose writes about how U.S. casinos brought lawsuits to Macau in a column for the May issue of Casino Enterprise Management magazine. Like Hong Kong, Macau is one of two special administrative regions in China and has its own legal system.
Rose writes, “The most common suit is by individuals who claim that they should be given a share of what has become a successful company.”
As an example, he cites a suit against Las Vegas Sands Corp. CEO Sheldon Adelson, filed in Nevada in 2008 by a Hong Kong businessman. The man claimed he had introduced Adelson to high-ranking officials in China and paved the way for Adelson’s “concession,” a form of gambling license, in Macau.
The Chinese businessman initially won, but the Nevada Supreme Court overturned the judgment in 2010. The case is set for retrial next year.
And a high-profile case against Wynn Resorts, Limited, has been making headlines recently. It involves ousted Wynn vice chairman Kazuo Okada and his other companies, Aruze USA Inc. and Universal Entertainment Corp.
As part of his suit in January, Okada claims that CEO Steve Wynn gave some $135 million to the University of Macau last fall in hopes of currying favor with the Chinese.
A shareholder derivatives suit soon followed. Rose writes, “We can expect more investigations from the Department of Justice, the Securities and Exchange Commission, and Hong Kong securities regulators.”
Other Macau-related casino suits spotlighted by Rose include:
■In January, Asian American Entertainment sued the Sands, saying the two companies had an agreement to bid for a Macau concession together, according to Rose. The suit claims the Sands breached the contract, and the Asian firm seeks some $375 million damages.
■After Steve Jacobs was fired from running the Sands’ Macau operations in 2010, he filed suit claiming wrongful termination. Jacobs alleged he was fired for refusing to use a Macau attorney who was involved with the government.
Rose writes that the involvement raised “serious questions” about possible violations of the U.S. Foreign Corrupt Practices Act, which forbids corporate payments to government officials in return for favorable treatment. The suit is pending.
Sands, Bethlehem, PA:
January 24, 2012
By Pamela Lehman and Riley Yates, Of The Morning Call
Bethlehem police conduct first prostitution bust at Sands casino hotel
In a first-ever prostitution raid involving the Sands casino, Bethlehem police conducted an undercover sting over the weekend, charging five women with prostitution and a Whitehall Township man with acting as their pimp.
The 2 1/2-hour operation came after casino hotel officials complained to police about prostitutes catering to their guests. Two of the accused were sent to prison, including the suspected pimp, who has faced prior prostitution charges in Allentown and Bushkill Township.
Even as Sands eyes Spain --
Sands opens Macau casino, eyes $35 bln Spain complex
Sunday, April 8, 2012
EuroVegas No!
Casino mogul Adelson pressures Spain to bend rules for EuroVegas
American casino mogul Sheldon Adelson's EuroVegas project could bring Spain much-needed investment, but the deal comes with demands for unappealing legal and financial exemptions.
By Andrés Cala, Correspondent / April 6, 2012
Madrid
American casino mogul Sheldon Adelson has a “vision” of bringing a massive Vegas-style casino complex to Spain and is tempting officials with billions in investment and tens of thousands of jobs that are sorely needed.
But Mr. Adelson's proposal comes with big demands, which reportedly include fiscal breaks and substantive reforms to Spanish laws, and have already prompted a backlash that could upend the project altogether. His proposal is triggering a broader debate in Spain about just how far the country should be willing to go to exit its worst recession in decades. Spain's final decision on the proposal isn't expected until this summer.
The proposed project would involve building 12 hotels, six casinos, a concert hall, several theaters, and golf courses on about three square miles over the next decade. Ron Reese, vice president of public relations for Adelson’s Las Vegas Sands Corp., told officials and Spanish media during a tour last month that some 17 billion euros would be invested and around 260,000 jobs would be created.
Adelson’s company hasn’t made its case publicly and the aura of secrecy is raising even more suspicions. The company did not answer multiple requests for comment.
Analysts, politicians, and economists in Spain have suggested that the economic benefits are not realistic. With several casinos in three different cities, Adelson's company only hired 36,000 people, they say. And besides, the rate of employees per hotel room – a common unit of measurement for Spain's tourism industry – for Adelson's proposal is much smaller than that of Spain's overall average.
American casino mogul Sheldon Adelson's EuroVegas project could bring Spain much-needed investment, but the deal comes with demands for unappealing legal and financial exemptions.
By Andrés Cala, Correspondent / April 6, 2012
Madrid
American casino mogul Sheldon Adelson has a “vision” of bringing a massive Vegas-style casino complex to Spain and is tempting officials with billions in investment and tens of thousands of jobs that are sorely needed.
But Mr. Adelson's proposal comes with big demands, which reportedly include fiscal breaks and substantive reforms to Spanish laws, and have already prompted a backlash that could upend the project altogether. His proposal is triggering a broader debate in Spain about just how far the country should be willing to go to exit its worst recession in decades. Spain's final decision on the proposal isn't expected until this summer.
The proposed project would involve building 12 hotels, six casinos, a concert hall, several theaters, and golf courses on about three square miles over the next decade. Ron Reese, vice president of public relations for Adelson’s Las Vegas Sands Corp., told officials and Spanish media during a tour last month that some 17 billion euros would be invested and around 260,000 jobs would be created.
Adelson’s company hasn’t made its case publicly and the aura of secrecy is raising even more suspicions. The company did not answer multiple requests for comment.
Analysts, politicians, and economists in Spain have suggested that the economic benefits are not realistic. With several casinos in three different cities, Adelson's company only hired 36,000 people, they say. And besides, the rate of employees per hotel room – a common unit of measurement for Spain's tourism industry – for Adelson's proposal is much smaller than that of Spain's overall average.
SOP for the Gambling Industry - Job Creation exaggerated.
At the time, Mr. Reese also acknowledged that any decision will depend on the “flexibility” of authorities as they consider Adelson’s terms. Both the company and Spanish authorities have yet to confirm what incentives are being negotiated, but both have said talks are in advanced stages.
Some of Adelson’s terms have been widely published in the press. They reportedly include tax breaks; social security exceptions; and reforms to anti-smoking, labor, and immigration laws; on top of land concessions and significant public spending in surrounding areas. Some of them violate existing Spanish laws – such as bans on smoking in casinos, gambling by minors and gambling addicts, and money laundering – and exceptions or changes to the laws would require parliamentary approval.
Both Barcelona and Madrid are being considered for the project and both cities made their case in Las Vegas last week. Madrid appears more than willing to make exceptions for Adelson. Its leading regional politicians, aligned with the Spanish government, have insisted they will do anything in their power to win Adelson’s business. All officials admit there is room to negotiate, as long as it’s within the law, but they have been intentionally vague about the specifics of the deal.
Adelson’s demands, or at least the public perception of them, are indeed threatening the EuroVegas project.
“Just because someone offers money doesn’t mean we should do them any favors,” says Xavier Sala i Martín, a well-known Spanish economist and professor of development economics at Columbia University. “The bar should be equality under law. Whatever authorities offer Adelson has to be offered to all companies. Some laws should be changed, indeed, because it’s in better for Spain – but not to attract an investment.”
Worried about 'the worst of Vegas'
Adelson first announced he was in talks for a EuroVegas in Spain more than a year ago, but with Spain focused on its economic crisis, growing unrest, and political upheaval, negotiations didn’t get very far.
Unemployment now stands at more than 23 percent and is expected to peak at 25 percent. The economy is projected to contract 1.5 percent in 2012 and not return to growth until 2014. Austerity measures have been severe and are expected to only get worse.
Mega casino proposals are not new to Spain, which receives nearly 60 million foreign tourists every year. At least another couple of mega casino projects have been announced in Spain over the past years, including one that attracted millions in investment, but the plans fell through as the crisis scared investors away.
Interest in Adelson’s EuroVegas picked up once the conservative Popular Party swept elections in November 2011. Adelson met with top regional officials to discuss his project as recently as February 2012.
But concerns about gambling, prostitution, money laundering, and other stigmas of the casino industry are not new either and Spain, like the rest of Europe, has strict anti-gambling laws although casinos are legal and numerous.
“Spain should impose conditions. They have to attract higher value-added tourists,” says Gayle Allard, a managerial economic professor at IE Business School in Madrid. “Make sure EuroVegas doens’t look like the worst of Vegas.”
Opposition against the project has also been building as officials admitted in the past two weeks to be involved in advanced negotiations, despite getting close to no public input. Spain is in dire need of investment and job creation – but at what price, many ask.
“They are keeping negotiations secret. They never asked anyone’s opinion. Even after we asked, they haven’t told us anything,” says María Fernández, a spokeswoman of the EuroVegas No! initiative. She was one of a dozen protesters delivered a letter Wednesday to Madrid officials demanding the project be scrapped.
“I believe Adelson really wants to build EuroVegas, but this can unwind at any moment,” Dr. Sala i Martín says. “He’s asking for exceptionality that shouldn’t be granted. But if the government’s Casino mogul Adelson pressures Spain to bend rules for EuroVegas
American casino mogul Sheldon Adelson's EuroVegas project could bring Spain much-needed investment, but the deal comes with demands for unappealing legal and financial exemptions.
(Page 2 of 2)
Worried about 'the worst of Vegas'
Adelson first announced he was in talks for a EuroVegas in Spain more than a year ago, but with Spain focused on its economic crisis, growing unrest, and political upheaval, negotiations didn’t get very far.
Unemployment now stands at more than 23 percent and is expected to peak at 25 percent. The economy is projected to contract 1.5 percent in 2012 and not return to growth until 2014. Austerity measures have been severe and are expected to only get worse.
Mega casino proposals are not new to Spain, which receives nearly 60 million foreign tourists every year. At least another couple of mega casino projects have been announced in Spain over the past years, including one that attracted millions in investment, but the plans fell through as the crisis scared investors away.
Interest in Adelson’s EuroVegas picked up once the conservative Popular Party swept elections in November 2011. Adelson met with top regional officials to discuss his project as recently as February 2012.
But concerns about gambling, prostitution, money laundering, and other stigmas of the casino industry are not new either and Spain, like the rest of Europe, has strict anti-gambling laws although casinos are legal and numerous.
“Spain should impose conditions. They have to attract higher value-added tourists,” says Gayle Allard, a managerial economic professor at IE Business School in Madrid. “Make sure EuroVegas doens’t look like the worst of Vegas.”
Opposition against the project has also been building as officials admitted in the past two weeks to be involved in advanced negotiations, despite getting close to no public input. Spain is in dire need of investment and job creation – but at what price, many ask.
“They are keeping negotiations secret. They never asked anyone’s opinion. Even after we asked, they haven’t told us anything,” says María Fernández, a spokeswoman of the EuroVegas No! initiative. She was one of a dozen protesters delivered a letter Wednesday to Madrid officials demanding the project be scrapped.
“I believe Adelson really wants to build EuroVegas, but this can unwind at any moment,” Dr. Sala i Martín says. “He’s asking for exceptionality that shouldn’t be granted. But if the government’s desperation is such that it will bend laws for him, than yes, this could actually happen.”
Perpetuating a broken economic model
The bulk of Aldelson’s job-creation proposal would be in the construction and tourism sector, mostly as low-income jobs – precisely the kind of economic model that led Spain to the economic pain it’s now enduring.
When a real estate bubble burst in 2008, leaving millions of workers without a job, the economy simply couldn’t absorb the suddenly unemployed workforce without a substitute industry.
Critics say Adelson’s proposal reinforces an unsustainable economic model and adds insult to injury because it includes a request for tax and social security exemptions.
“Jobs and investment are not worth what they want in return,” Ms. Fernández says as she passes out flyers in Madrid's main plaza, Puerta del Sol. Could she be persuaded with more information though? “No. This is not the economic model we need. We don’t want a Sin City here. We don’t want Adelson’s money here. The entire project is intolerable.”
But some economists disagree. “You have to be realistic. In the short term, what do you do?” asks Dr. Allard. “Spain should grab anything to create jobs. If you can get someone to come in, while economy gets back on its feet, it’s a fiscal stimulus in itself.
“Besides,” Allard adds, “nobody is going to come and say they’ll hire 300,000 to build high technology industries.”
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