Awake, and digesting the latest news from Caesars By Jeffrey Compton June 27, 2014 at 8:59 am Its 4:00 a.m. in the morning – Cleveland time. I’m in my middle of my morning CDC newsroom editing chores (albeit a little early, but I am on a new training regimen that has thrown my sleep schedule way off.) I’m looking at four stories – all of them less than 24 hours old, all concerning Caesars Entertainment. Union: New Jersey casino warns of possible closure Later this morning approximately 2,500 loyal Caesars Employees will be informed that with all probability they will be out of a job by the end of the summer. That’s more bad news for Atlantic City and New Jersey. This would the second high-profile Caesars property closing, following the shuttering of Harrah’s Tunica, in Mississippi. (A few hours after this story was initially posted Caesars did confirm that the Showboat will close on August 31.) Caesars Loan Proposal Vote Delayed by Illinois Gaming Board In order to stay afloat with $23 billion in debt (that’s $73 for every man, woman, and child in America), Caesars Entertainment has been doing some creative financing – specifically moving around assets. I majored in finance and investments in college, but I have no clue how this will all work out – except that someday somewhere somebody’s bond fund or pension fund isn’t going to get the money it was counting on. Caesars to appeal dismissed lawsuit against state Caesars wanted a casino in Massachusetts for a variety of sound reasons, not to mention that the Bay State is the home state of Caesars CEO and president Gary Loveman. Because of a relatively minor involvement with another company who had an investor who may or may not have had ties to Russian organized crime, Caesars had to withdraw from the entire licensing process (obviously I agree that they got shafted). So Loveman and Caesars filed a lawsuit against the Massachusetts Gaming Commission Chairman Stephen Crosby, alleging he was favoring Steve Wynn’s project in Everett all along. Last month a US Federal judge practically laughed Caesars out of court, saying the claim rested on a “shaky foundation” of “naked assertions,” ”improbable inferences” and “sensational accusations”. More importantly, a justifiably angry Steve Wynn jumped to Sheldon Adelson’s ship in middle of the Internet gaming war, a move that eventually lead to the American Gaming Association withdrawing all efforts toward Internet Gaming legalization – something that would have benefited Caesars. Undaunted by the side effects, Caesars has filed notice that they intend to appeal the ruling dismissing their lawsuit against Crosby. It does not seem to phase Loveman and Caesars that this will be happening during a very important election for the gaming industry – in November, Massachusetts could be the first state to repeal legalized casino gaming. From what I have read and heard, Bay State residents are not anti-casino or anti-gaming as much as they are disgusted with the licensing process and the negative publicity it has brought to the state. (The bad news from Atlantic City – less than 250 miles away – probably doesn’t help.) Although recent polls indicate that Mass voters will not repeal gaming, it will be a close hard-fought election, and the effects of gaming repeal would be catastrophic for the entire gaming industry – everywhere. Caesars Confident on Financing Potential $5 Billion Japan Casino Even with $23 billion in debt, Caesars feels that they will have no problem raising another $5 billion to build a world-class facility Japan, the world’s latest emerging market, even though they will be competing against better-financed rivals with considerably more Asian gaming experience in an untested market with yet-to-be discussed licensing procedures. (Only three years ago, Massachusetts appeared to be an exciting new market.) And while the finance end of my thinking tells me that this makes sense (other Asian gaming markets have done so well that any less-than-fantastic figures are news-worthy) I still can’t help wondering how this looks to the 2,500 loyal Caesars employees in Atlantic City whose world is crashing down this morning.