Adelson in ‘Net gaming pact

David Strow

Monday, April 1, 2002 | 11:05 a.m.

The parent company of the Las Vegas Strip's Venetian megaresort is mounting an effort to enter the world of Internet gambling.

Las Vegas Sands Inc.'s on-line gambling efforts were disclosed this morning in an annual report with the Securities and Exchange Commission. But the company said little about how close it is to launching an Internet casino, saying only that it is "actively pursuing the possibility of developing and operating an Internet gaming site."

The company said it entered into a joint venture agreement in January 2002 "to assess the feasibility of developing and operating an Internet gaming site," but did not identify its partner.

Las Vegas Sands did not provide further details. Company officials declined comment this morning.

In Las Vegas, two other major gaming companies are moving into the Internet gambling arena. MGM MIRAGE has been awarded an Internet gaming license by the Isle of Man, a British dependency, and the company indicated in its annual report it hopes to launch the site within a year.

Station Casinos Inc. has signed a deal to acquire 50 percent of Sun International's Isle of Man Internet casino, and expects this deal to close in the third quarter.

Other Las Vegas gaming companies have approached Internet gambling with trepidation. But Venetian and Las Vegas Sands owner Sheldon Adelson has embraced it.

"Our hat will be in that ring," Adelson told the Las Vegas Sun in June 2001, shortly after the Nevada Legislature approved a bill authorizing the regulation of Internet casinos.

But because federal law regarding the legality of Internet gaming in the U.S. remains unclear, Nevada gaming regulators are no closer today to authorizing Internet casinos than they were a year ago.

As a result, Nevada companies interested in the business would have to set up Internet casinos outside the United States, and block Americans from accessing the sites. The Venetian didn't say where it was looking to do this, only that it needed a license "to operate the venture from a jurisdiction where Internet gaming is legal."

The company's other current international venture, a proposed casino in the Chinese city of Macau, will be a 500-suite hotel-casino and convention center complex, also with a Venetian theme, the annual report said.

The company will also build two additional, smaller casinos in the city.

"The company believes that the Macau opportunity provides an international platform to expand its premier Venetian brand and create increased diversification of, and a new source of significant growth for, its revenue base," the report said.

The Venetian has an agreement to develop and manage these casinos, but has no current ownership interest beyond an option to acquire a 30 percent stake in the three Macau casinos, the report said. Negotiations between Macau officials and the Venetian for a final license are continuing.

Las Vegas Sands said it is looking at other opportunities for expansion, "including Native American gaming and the possibility of developing casino resorts in certain foreign jurisdictions," but again provided no details.