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July 28, 2014

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MGM seeks to get back half-ownership of Borgata

Three years after agreeing to surrender its half ownership of Atlantic City's top casino rather than cut ties to a family suspected of links to Chinese gangsters, MGM Resorts International has had a change of heart.

The Las Vegas-based company is asking New Jersey casino regulators to allow it to keep its 50 percent stake in the Borgata Hotel Casino & Spa. In a petition to the state Casino Control Commission filed Friday, MGM asked the commission to reconsider its status and deem it fit to hold a New Jersey casino license once again.

"MGM Resorts International is, and always has been, committed to the highest standards of operation and regulatory compliance," the company said in a statement Monday. "If our petition is successful, we would welcome the opportunity to once again be an active, contributing member of the New Jersey gaming marketplace through our 50 percent ownership of Borgata."

Matthew Levinson, chairman of the Casino Control Commission, said the request will be heard at Wednesday's meeting.

MGM decided leave New Jersey rather than cut ties to a business partner in Macau whose father is suspected by New Jersey regulators of having ties to Chinese organized crime. MGM and the family of Pansy Ho deny the allegations.

MGM reached an agreement with the gambling enforcement division in March 2010 to sell its half interest in the Borgata, but the Atlantic City casino market has plunged since then and no one stepped up to buy MGM's share. Boyd Gaming owns the other half of the Borgata, and passed on buying MGM's share.

New Jersey regulators have expressed concern about Pansy Ho, MGM Mirage's partner in the Chinese enclave of Macau. Her father, Stanley Ho, has been accused of ties to Asian organized crime gangs but never charged. He denies any such links.

In its petition to New Jersey regulators, MGM noted several changes it said should justify it being allowed to keep half of the Borgata. The Macau casino, MGM Macau, is no longer a 50-50 joint venture between the company and Pansy Ho; she now controls just over 27 percent of it.

MGM now controls the casino's board of directors, including the ability to break any ties.

"Stanley Ho is 91 years old and his health has declined precipitously in the last three years," the company wrote in its petition. "Since July 2009 Stanley Ho has divested most of his business interests," including a company in which his daughter is now the controlling shareholder."

Stanley Ho also sued his daughter and other relatives in 2011 over business disputes, further weakening the odds of him exerting improper control over her, MGM said in its petition.

MGM has until March 24 to direct a trustee overseeing its half ownership in the Borgata to sell it. After that, the trustee would be responsible for lining up a buyer.

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Wayne Parry can be reached at http://twitter.com/WayneParryAC

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