Sands Casino Resort Bethlehem Sale Not Imminent

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Thursday, March 30th, 2017 | Written by Charles Washington

While the parties involved are insisting there is currently no news to report, rumors are flying that MGM Resorts and the Las Vegas Sands Corporation are actively in talks over the sale of the Sands Casino Resort Bethlehem in Pennsylvania. Although industry experts report that it could take 6 months or more for any possible deal to go through, the potential sale is causing a flurry of excitement that could have big ramifications.

MGM’s $1.3BN Offer for Sands Bethlehem

According to the circulating rumors, MGM Resorts has offered $1.3 billion for the casino located in Eastern Pennsylvania. Representatives of both companies have said they do not have any information regarding such a sale, yet anonymous insiders say that it is imminent and well beyond the early stages of the deal. Reportedly, MGM Resorts is currently conducting due diligence, and examining the casino’s finances closely in order to determine if the sale is as profitable as it appears on face value.

A Profitable Business

Located just 70 miles south-west of New York City, Sands Bethlehem is one of the most successful of the 12 casinos which operate in the Keystone State. Amongst its many attractions are 180 table games, 3,100+ slot machines, a 300 bed-roomed hotel, as well as an arts and event center. In 2016, Sands Bethlehem subsequently reported a 3.7% increase in its revenues to $530 million, with its table games hold falling by 1%, but its slot handle up by 5.9% compared to the previous year.

Win-Win Situation

The fact that the move would make sense for both companies makes this news seem very plausible. MGM Resorts has been trying to expand its casino empire in the United States and has mostly been focused on the northeast as an area for development. The company does not currently operate any casinos in Pennsylvania, though, and a deal would therefore allow it to enter the market without having to wait for the state to issue more gaming licenses.

For the Las Vegas Sands Corp, shedding the Pennsylvania casino would be true to its brand. The Sands Casino Resort Bethlehem is the only casino that the company operates that is in a regional location, with all of the other resorts owned by Las Vegas Sands Corp located in fly-in gambling destinations like Las Vegas, Singapore and Macau. There is also some talk that CEO Sheldon Adelson is frustrated with Pennsylvania, and dismayed that the state is moving closer to legalizing online gambling, which he staunchly opposes.

A Plus for iGambling Advocates

Speaking of online gambling, industry insiders believe that the sale of the Sands Casino Resort Bethlehem would shift the discussion concerning online gambling legislation significantly. At the present time, the Las Vegas Sands Corp is the only one of the casino operators in Pennsylvania actively lobbying Harrisburg in hopes of stymieing the proposed law. Many feel that if the sale goes through, the pressure on lawmakers to fight the bill would be removed, allowing it to sail through both sides of the Pennsylvania legislature.

City of Bethlehem On-board

The city of Bethlehem is also hoping that the sale of the Sands Casino Resort Bethlehem will go through. While Las Vegas Sands Corp has brought 2,500 jobs to the city and invested in developing the property, there are several unused buildings located on the property that the city has been urging the company to develop. Reportedly, lawmakers are hopeful that MGM Resorts would put more money into the casino resort, which would bring more jobs to the area and presumably bring more tax revenues for local and state government.

Agreement Not Imminent

If the deal was successful, it would mark the sixth casino sale in Pennsylvania since the state legalized gambling. However, analysts have estimated it could take more than 6 months before any potential deal is completed, with Doug Harbach, Director of Communications for the Pennsylvania Gaming Control Board, highlighting the involvement of his organization in the process by stating that “in a nutshell, it is our job to ensure the integrity of gaming in the commonwealth.. and to make sure the games are fair.”

Elaborating further on the extensive procedures that must be adhered to before an agreement is reached, Alan Silver, Assistant Professor at Ohio University, explained that MGM will still “have to go through the time period, the hoops, the procedures the gaming commission has in line. There’s no shortcuts.”