Foxwoods and MGM MIRAGE Sign Revolutionary Pact

Foxwoods and MGM MIRAGE Sign Revolutionary Pact

The world’s largest casino complex and the country’s second largest gaming company have signed a pact for an innovative and wide-ranging strategic alliance.

MGM MIRAGE is immediately providing a loan of up to $200 million to aid in the development of a $700 million destination hotel/casino resort, which is already under construction at Foxwoods and is scheduled to open in spring 2008. The expansion will be nearly 2 million square feet in size, utilize the MGM moniker on its 825-room hotel and add 150,000 square feet of meeting space, a 50,000-square-foot casino, a 5,000-seat theater, four restaurants, nightclubs, a spa and a parking garage.

The agreement will also open the door to a long ranging partnership that will include the collaboration and development on master planning on future destination gaming resorts and other facilities at Foxwoods Resort Casino.  Additionally, MPTN and MGM MIRAGE will commence multiple cross-marketing initiatives between their resorts.

“The Tribal Nation here at our ancestral homelands in Mashantucket welcomes and honors this strategic alliance with MGM MIRAGE,” said Michael J. Thomas, Chairman of the Mashantucket Pequot Tribal Nation, in a statement. “Our affiliation with MGM MIRAGE provides us with an experienced advisor in gaming, a proven resort development partner, at Mashantucket, and an equal partner in a powerful venture all at once. The quality and positive energy of the people who lead MGM MIRAGE mirror the culture we have embraced from the onset of our gaming enterprise.

According to William Sherlock, chief executive at Foxwoods in an interview in the Boston Globe, Foxwoods generates 78 percent of its revenue from gambling and 22 percent from other activities. He would prefer for there to be a more even split, which is commonplace in jurisdictions like Las Vegas where MGM MIRAGE operates the majority of casinos on the Strip. This deal will be an integral part in achieving that goal.

This deal has the potential to shake up the status quo of the rapidly consolidating gaming industry, so regulators are beginning to scrutinize its legality because many its terms have thus far been vague.

According to a letter obtained by onlinecasinocrawler.com , which was sent to George Henningsen, the Tribal Gaming Commission chairman of Foxwoods Resort Casino and co-signed by Connecticut Attorney General and Richard Blumenthal, Executive Director of Special Revenue said MPTN did not inform the Division of Special Revenue or the Attorney General’s office on “its plans to enter into a partnership with MGM to expand it gaming operations.” They further explained the nature of the proposal is “unclear” from the announcement and do not at this know if it “comports with federal law and Gaming Procedures.”
Foxwoods Resort Casino currently has 340,000 square feet of gaming space in six casinos that have more than 7,400 slot machines and 400 tables with 17 different types of games, including 114 poker tables. There’s also a Race Book, the world's largest Bingo Hall, 1,416 guest rooms and suites and 55,000 square feet of meeting space. More than 40,000 guests visit the resort each day.