Casino news from http://news.enquirer.com/
Grand Victoria Casino & Hotel in Rising Sun will be up for sale this fall.
Majority owner Hyatt Hotels & Resorts will put the 201-room and casino on the market in September, said general manager Steven Jimenez. He said Grand Victoria's 1,100 employees have already been notified of the plan.
"We don't anticipate the sale process to impact our customers or our employees," he said, adding that Goldman Sachs will help with the sale.
Jimenez said he didn't know what prompted the decision to sell the casino, which opened on Oct. 4, 1996. He did not know what the asking price would be.
Officials at Hyatt Gaming Management in Chicago, which operates the casino, could not be reached for comment. Hyatt Gaming owns four other casinos - two in Nevada, one in Argentina and one in Aruba - and provides management services at two others in Niagara Falls, Ontario.
In the calendar year 2005, the casino's "win" from what gamblers lost was nearly $150 million.
Grand Victoria had nearly 1.9 million admissions in fiscal 2005 (which ended this June) and paid $3 million in gaming and admission taxes, according to the Indiana Gaming Commission.
The 40,000-square-foot riverboat casino offers 42 gaming tables and 1,489 slot machines. It has five restaurants and an 18-hole golf course.
Michael Cahill, president of Denver-based hotel and casino consulting firm HREC (Hospitality Real Estate Counselors), said casinos are commanding significant premiums as the gaming industry looks for new growth when new development opportunities are scarce. He said the going rate for a casino acquisition in today's market is up to 50 percent more than it was a decade ago. A casino now will typically sell seven to nine times cash flow (before depreciation, amortization, taxes and interest), versus six to seven times 10 years ago.
Cahill also said Fort Mitchell-based Columbia Sussex would be a logical suitor, noting the company's familiarity with the Midwest and recent flurry of acquisitions - most recently the pending $2.8 billion takeover of Aztar Corp.
"If I were a broker for this casino, my first call would be to Columbia Sussex," he said, adding other gaming companies without a local presence might also be interested.
Officials at Columbia Sussex declined to comment on Tuesday.
The announcement of Grand Victoria's looming sale also comes as the casino might face intensified competition.
Lawrenceburg's Argosy Casino last week disclosed it is beefing up a previously announced expansion.
Argosy's parent Penn National Gaming Inc. said it will replace the current 74,300-square-foot barge with a 250,000-square-foot barge that will open in late 2008.
Rising Sun Mayor Bill Marksberry said the opening of Grand Victoria was a major development for the city of 2,400.
"It's one of those businesses that employ a lot of people here as well as from Ohio, Kentucky and Indiana," he said, adding he was optimistic a sale would not adversely affect the local community.
According to a report filed with the gaming commission in 2004, Grand Victoria is 80 percent owned by Indiana RBG LP, a subsidiary of H. Group Holding Inc., and 20 percent owned by RSR LLC.
H. Group Holding, Inc. is a private holding company owned indirectly by trusts for the benefit of the secretive but wealthy Pritzker family of Chicago.
The Pritzkers in 2004 settled a two-year legal battle with two young heirs in a two-year legal battle over the family's estimated $15 billion empire.
The primary businesses of H. Group Holding Inc. are the operation and ownership of Hyatt Hotels in North America, the management of retirement facilities, the leasing of equipment including personal computers, computer workstations, temporary storage tanks and related products.
The gaming commission report said that for fiscal year 2003, H. Group Holding Inc. had total assets of $5.3 billion, which produced sales of $2.78 billion. Grand Victoria represented about two percent of total assets of H. Group Holding.
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