Mexican gaming center will reopen

Wednesday, Dec. 12, 2001 | 10:44 a.m.

Viva Gaming & Resorts Inc. of Las Vegas announced plans to reopen a shuttered gaming center in Mexico City, following a court victory.

However, the center's size will be greatly reduced.

Viva's "lottery entertainment center" -- a joint venture with Phoenix Leisure Corp. of Las Vegas -- opened with 440 machines on Nov. 1, and was almost immediately shut down by federal officials. The only forms of gambling permitted in Mexico are lotteries, raffles and horse racing; the Viva machines could only be played with tokens, and winners were paid with lottery tickets and vouchers for prizes.

Viva filed an injunction with a Mexican federal court Nov. 26, claiming the machines constituted games of skill and that the center was legal under Mexican law. This request was denied, but Viva's appeal was successful, the company said.

However, the appellate order allows Viva to operate just 47 machines at the center. Further details from the ruling had not yet been received, the company said.

Separately, Phoenix Leisure announced Monday it has acquired a 50 percent equity stake in four small cardrooms in Washington state owned by Cleopatra Gaming Management. The cardrooms are authorized to offer up to 15 house-banked card games, and impose a $100 loss limit. Phoenix Leisure said it expects to generate $1 million in annual cash flow from the investment.

Phoenix Leisure advanced Cleopatra $1.8 million to purchase and develop the cardrooms, and converted this loan into equity in the four properties. Cleopatra is wholly owned by Eric Nelson, who serves as chairman and president of Phoenix Leisure and chief executive of Viva Gaming. Phoenix Leisure also holds an 18 percent stake in Viva.

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