Casino news source: Courier-Journal - http://www.courier-journal.com
French Lick casino takeover OK'd by panel
Cook family is set to buy out partner
By Lesley StedmanWeidenbener
lstedman@courier-journal.com
The Courier-Journal
INDIANAPOLIS -- With approval yesterday by gambling regulators, the family of billionaire Bill Cook will take full control of the French Lick Casino Resort, ending a troubled relationship with its Indianapolis partner.
The Bloomington entrepreneur and his family will pay an undisclosed amount to developer Lauth Property Group, buying out Lauth's 50 percent interest in the Orange County casino and two historic hotels.
"We've always said from the very beginning that our goal was to create the Midwest's premier destination in French Lick, and we believe we've done that," said Lauth's general counsel, Vernon Back.
But now, he said, "We believe it's in the best interest of the project to have one owner."
The Indiana Gaming Commission approved the deal on a voice vote yesterday with no discussion. A Lauth spokesman said it likely will take several weeks to complete the transaction.
Gamblers are not likely to notice the transition, and the casino's management staff will remain, said officials of Cook Group, the medical device company that Bill Cook founded and owns.
Ernie Yelton, the commission's executive director, said the change will remove the tension that had gripped the casino's development and operations.
The deal ends a chaotic marriage of two companies that had joined in 2005 to win the license for Indiana's 11th casino.
Representatives of Lauth and the Cook-backed Orange County Holdings said yesterday that they had different philosophies about the $380 million project, and that those differences sometimes led to disagreements about its development and management.
"We have a long-term view, and we see the long-term impact of the project -- not only in its success but the impact on south-central Indiana," said Steve Ferguson, chairman of Cook Group.
"Lauth is generally a short-term investor. They buy or build and look to turn them around," Ferguson said. "I'm not saying one side is right or wrong. It's different."
The companies' feuds spilled into court last year as each sued the other, in part to wrest majority control of the project. But despite the struggles, the casino and the French Lick Springs Resort opened on time late last year, and the nearby West Baden Springs Hotel opened last month.
The sale will end all legal issues between the two companies.
The French Lick project was funded largely through a $270 million bond issue the partners sold to investors last year. Cook provided the two historic hotels, which he had purchased for restoration. The value of that contribution was $58 million.
The remaining funding for the project came from a variety of sources, including historic rehabilitation tax credits.
The financing had been part of the squabbles between the companies, and at one point last year Cook officials offered to buy out Lauth. But the Indianapolis developer declined.
Yesterday, Back, the Lauth counsel, said that even now making the decision to sell was difficult. "There've always been discussions back and forth, but now is the right time," Back said.
Once the deal is completed, the hotels and casino will be owned by two entities: Orange County Holdings, the original partner in the development, and the newly created BSR OC Acquisitions LLC.
Reporter Lesley Stedman Weidenbener can be reached at (317) 444-2780. |
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