Fiesta sale gets approval

David Strow

Tuesday, Nov. 21, 2000 | 11:08 a.m.

The Nevada Gaming Commission endorsed Station Casinos Inc.'s acquisition of the Fiesta hotel-casino Monday, clearing the way for the locals casino giant to pick up its sixth property in the Las Vegas Valley.

The $185 million purchase of the Fiesta from the Maloof family was approved by a unanimous vote. The final step for Station is to receive approval from the city of North Las Vegas; if that happens as scheduled, Station plans to close on the purchase in January.

Two issues that could have caused difficulty for Station -- the company's plans to require the property's 1,100 workers to re-apply for their jobs, as well as Station's growing market share in Las Vegas -- did not end up causing trouble for the Las Vegas-based company.

Culinary Union Staff Director D. Taylor asked the commission to make Station retain the Fiesta employees as a condition of its license -- a request the commission denied in September when Station took over the Santa Fe.

"The commission heard that issue in September, and had essentially decided the policy then," said Commission Chairman Brian Sandoval. "The commission agreed unanimously that it isn't appropriate for the commission to impose on the purchase the requirement that the buyer retain employees of the seller."

Station officials have said they plan to use Station employees to fill jobs at the Fiesta, though they've hinted a sizable number of Fiesta employees could be retained.

And, following the lead of the control board, the commission decided Station's market share wasn't a reason to squelch the pending deal. Sandoval said that line also probably won't be crossed with Station's plans to acquire the Reserve in Henderson for $70 million.

"People still have a choice ... they don't have to go to a Station property," Sandoval said. "Even with the purchase of the Reserve, they won't come anywhere near (the market concentration) of an MGM MIRAGE, which was previously approved.

Commissioner Augie Gurrola jokingly called Station's acquisition spree as "reminiscent of when the settlers would circle the wagons to keep the Indians out," and wondered whether it was to capture visitors coming into the city, or whether Station was trying the shield the Strip.

Gurrola said he didn't believe Station's buyouts of the Fiesta or the Reserve raised antitrust concerns. But since the issue has been coming up repeatedly in recent years, he believes gaming regulators may want to provide more definition on the subject of market concentration.

Nevada gaming regulations state that regulators should look at such factors as total numbers of slots, table games, gross gaming revenues, number of hotel rooms and number of employees when considering market share, but provides no definition on what's excessive.

"It's a little nebulous," Gurrola said. "We need to somehow eventually have discussions on that. It's better to have a standard rather than waiting until we're faced with that problem. We know the factors, but I think we have to somehow examine it to see what the limits are."

The commission also awarded a gaming license to the Herbst family for Terrible's Hotel-Casino, which is scheduled to open on Paradise Road in Las Vegas by the end of this month. The $63 million, 370-room hotel-casino was built from the shell of the former Continental hotel-casino, and is owned by Herbst brothers Edward, Timothy and Troy.

"The management team and the Herbsts are long-time licensees, so there were no concerns," Sandoval said. "They're taking a blighted property, improving it, restoring it and investing back into the community."

The commission also approved Herbst-owned E-T-T Inc.'s purchase of Cardivan Co., the slot route operation now owned by Jackpot Enterprises Inc. That $38 million buyout is expected to close within days.

Sandoval also announced he was dropping a controversial proposal to place a $550 cap on bets on college events in Nevada sports books. The proposal had been designed to blunt NCAA concerns that illegal bookies were laying off bets in Nevada books, but had run into fire from Nevada gaming interests.

"My concern is that it would have created a market for illegal bookmakers in the state of Nevada where one didn't exist, and it would have been created by government action," Sandoval said. "I just didn't think it would have been good policy to institute a regulation that would have been a catalyst to creating illegal bookmakers in the state of Nevada."

Left intact in the proposal are plans to legalize wagering on Nevada college teams, and to prohibit betting on some amateur sporting events, such as high school games and the Olympics. The regulation would also ban certain athletes and coaches from wagering in sports books, and would allow the commission to consider information regarding illegal bookmakers provided by the NCAA to be used in a decision to include a person in Nevada's "Black Book."

"It's a bridge of cooperation between the state of Nevada and the NCAA," Sandoval said.

The regulation is expected to be considered at the commission's January meeting in Las Vegas.