THIS STORY HAS BEEN FORMATTED FOR EASY PRINTING
< Back to front page Text size +

Report raises questions on Foxwoods casino bid in Milford

Posted by Your Town  November 13, 2013 12:54 PM

E-mail this article

Invalid E-mail address
Invalid E-mail address

Sending your article

BOSTON (AP) — A background check by investigators for the Massachusetts Gaming Commission has raised questions about the ability of a group led by Connecticut casino operator Foxwoods to manage a proposed $1 billion resort casino in Milford.

The report, released by commission staff on Wednesday, urged the five-member panel to consider issues Foxwoods has had in finding additional financing, along with Foxwoods’ current debt and overall financial condition.

The commission is holding a two-day hearing before deciding whether the bidder, formally known as Crossroads Massachusetts, is suitable to submit a final application for the sole eastern Massachusetts resort casino license allowed under the state’s 2011 expanded gambling law.

The report said commissioners should question the ‘‘business ability of the applicant to run a successful gaming operation in Massachusetts given its difficulty in finding an additional equity interest and the current debt load and declining revenues of their proposed operator.’’

Karen Wells, director of the gambling agency’s investigations and enforcement bureau, said at the outset of the hearing that she was unable to advise the commissioners as to whether the Foxwoods bid should be cleared to continue in the process. She said the ‘‘glaring issue’’ involved the failure of the group to secure a 55 percent equity ownership interest in the project.

‘‘The IEB is not in a position to make a recommendation about suitability because we don’t have a complete picture of what this applicant is going to look like,’’ Wells said.

Scott Butera, Foxwoods’ president and chief executive, told the commission that Foxwoods was in active negotiations with two entities that had made ‘‘very strong offers’’ to fill the gap in equity funding.

‘‘I am confident in short order we will have that done,’’ Butera said.

He did not identify the potential equity partners, citing confidentiality in the negotiations, but said one was a private equity firm with experience in the casino industry, and the other a publicly traded company that would provide funding for the real estate portion of the development.

Butera said Foxwoods successfully restructured its debt earlier this year and is now on sound financial footing.

Stephen Crosby, chairman of the commission, said the panel would make a written recommendation on suitability at some point after the hearing was concluded.

Foxwoods must also gain the approval of Milford residents in a referendum scheduled for Tuesday before it can file a formal application by the Dec. 31 deadline. The project would be built on an undeveloped site near Interstate 495.

Las Vegas casino operator Steve Wynn, who has proposed a $1.2 billion resort casino along the Mystic River in Everett, is also pursuing the eastern Massachusetts license.

Another potential bidder for the license, Suffolk Downs, suffered a major blow last week when East Boston voters rejected the project in a referendum. The thoroughbred race track has since opened discussions with officials in Revere — where residents voted to back the proposed casino — about the possibility of moving the entire project into that city.

E-mail this article

Invalid E-mail address
Invalid E-mail address

Sending your article