Having tried and failed to grow the company through an LBO, Station Casinos is returning to the public markets again, citing “favorable economic and market fundamentals” in support of an IPO. An executive shakeup that included the promotion of Rich Haskins to president accompanied the IPO. The company is riding 
a long upward trend both in its own performance (17 consecutive quarters of improved cash flow) and in the Las Vegas economy. A sweetheart provision in the proposed IPO would see Station buy management entity Fertitta Entertainment for $460 million. (Station just can’t help its addiction to this stuff.) The company is still carrying $2 billion in long-term debt and it’s not clear that this IPO would create that much more flexibility.
However, Station has been in a prolonged period of inactivity in Nevada, while numerous capital projects remain on ‘hold.’ This proposed offering may be a signal that Station is ready to move again. The initial float is $100 million but the Wall Street Journal called that “a placeholder and likely to change.” Neither the number of shares to be released nor their price 
has been disclosed. The Fertitta Entertainment buyout will negate a $450 million reduction in Station’s debt load. On a more positive note, the company has made capex investments of $330 million in its existing properties, an example from which other companies (*cough*Caesars Entertainment*cough*) might benefit. For that matter, perhaps Station should wait for the near-inevitable bankruptcy of SLS Las Vegas and then swoop for the kill.
Station is also enjoying an upgrade to “positive” from Standard & Poor’s, which wrote, “The outlook revision reflects our expectation 
that Station Casinos’ credit measures will continue to improve through 2016, as a result of continued good operating performance coupled with debt repayment.” As for new development, our advice is hasten slowly. This week, the Los Angeles Times painted a picture of an anxiety-ridden Las Vegas economy, with the hulk of Fontainebleau its poster child. Or, as University of Nevada-Reno political science professor Erik Herzik put it, “The economy is coming back, but it’s still got a lot of holes,” echoing a theme Steve Wynn has articulated in the recent past.
Nevada leads the nation in new foreclosures and its 7% unemployment rate is second in the nation to West Virginia’s. “Anywhere on the outskirts [of Las Vegas] is really hurt,” says real 
estate broker Kyle Wilcox. (Although housing development is finally catching up with what used to be Aliante Station.) “Nobody can make it on what they’re being paid,” laments home-care worker Jamie Shanklin. She and her husband are having to eke out a living on $1,000 a month. This is the economic backdrop against which any new Station project would rise. The company will have to walk a tightrope between stimulating the local economy and creating product for which there is insufficient demand (see Station, Aliante). One wishes them wisdom as they open this new chapter in their corporate history.
* Boyd Gaming is trying to get a countersuit by poker pro Phil Ivey tossed. As you will recall, Ivey and associate Cheung Yin Sun are being sued for cheating because they cleaned Borgata‘s clock through a method of card-tracking known as “edge-sorting” (explained here). Ivey was countersuing, in part, because Borgata destroyed the cards in question. Boyd holds that this is standard practice but — given the extraordinary circumstances involved — wouldn’t it have been prudent to make an exception to policy as usual?
* We may finally have a breakthrough in the long standoff between Florida Gov. Rick Scott (R) and the Seminole Tribe. The details released so far depict the Seminoles gaining roulette and craps in 
return for ceding new, private-sector slot parlors in Miami-Dade County and Palm Beach County. (Both counties could lose “player-banked” card games.) The Seminoles would also pay $3 billion over the first seven years of the 20-year life of the compact. No wonder Las Vegas Sands pulled out of Florida if it got wind of this.
Parimutuels could be released from the obligation to run dogs or horses, or offer jai-alai, in return for getting slots under the new deal. The Seminoles have proclaimed themselves “agnostic” on the repeal of this quid-pro-quo. That could mean 3,500 fewer dog races a year at the Bonita Springs parimutuel alone.
Still, with Scott riding an improved economy and cool to a new compact, he’s unlikely to push hard against legislative gridlock that one solon described as “putting a queen-sized sheet on a king-sized bed.” Horseracing interests are expected to make a strong stand against decoupling, and three other counties want to be included in the slot-machine action. Any progress on the Seminole compact is a good thing but it’s far too soon for anyone to take a victory lap — especially with the Seminole’s right to offer blackjack expiring in two and a half weeks, potentially forcing an ugly confrontation with the state.
Florida residents, meanwhile, are 67% in favor of casinos but evenly divided between wide-open, Vegas-style gambling and the Seminole status quo. Twenty percent are opposed, period, their strength concentrated in the northern tier of the state.
* With Pennsylvania on the cusp of legalizing Internet wagering and New York State circling the topic, minions of Sheldon 
Adelson are pushing a new tactic. They propose to stomp over the 10th Amendment by forcing a two-year moratorium on further legalization while Uncle Sam conducts a bogus “study” of the issue. Since, as has been observed elsewhere, this is a mutated version of Adelson’s proposed, outright ban, what are the chances that the study will conclude that players are getting a square deal? If the fix was ever in, this is a clear case of it.
