Is Wynn Resorts again talking with potential buyers?

Wynn Buyer

By Josh Resnek 

A spate of articles on the Internet and in print during the past five days indicate that Wynn Resorts president Matt Maddox has conducted informal talks about a sale of the Everett project.

No one from Wynn has answered this assertion, however the fact that such rumors are swirling about, again, shows how everyone involved is becoming a bit more worried about what or what not the Massachusetts Gaming Commission is going to do when it releases its long awaited investigative report sometime in September.

“This is the surest sign that Wynn Resorts has been hearing some of the particulars about where the MGC is heading,” said an industry source with business before the MGC who wished to remain unnamed.

 

“It is impossible to know exactly what is going to happen. But you can be assured that Maddox wasn’t having a preliminary talk about selling the project without  some inkling about what the MGC is planning to do,” added the source.

The initial report about the possible sale appeared in a gambling industry trade website, Focus Gaming News.

What the MGC is going to do, how it is thinking, and what the possibilities are is examined with greater detail in a Forbes Magazine piece that was published on August 24.

The Forbes piece, titled, “If Wynn Resorts is Found Not Suitable in Massachusetts, Here is What’s Next.”

This report highlights MGC Chair Stephen Crosby’s admonition made much earlier in the summer.

“I have said repeatedly that for now we must proceed with the Everett project as planned and be thoughtfully mindful of the thousands of people whose jobs may be affected by this issue and of the long-term economic benefits envisioned by this project, But as a practical matter . . . Wynn Resorts proceeds with this project on an at-risk basis.”

The fact is, MGC has a game plan that protects the jobs and the casino if Wynn fails to qualify, according to the article in Forbes.

Forbes speculates that even if Wynn loses the license, there is a way out for everyone so that Everett survives and the new casino owner does well and Wynn gets paid.

The dreams of a casino in once- downtrodden Everett, MA will not be dashed if Wynn is unable to obtain a license. Even Wynn would be allowed to recover its investment, though it would not reap the rewards of hundreds of millions in gambling revenue that is projected if it were forced to sell.. If a gaming license is revoked by the MGC because an operator is no longer suitable, the Massachusetts’ Expanded Gaming Act authorizes the appointment of a conservator (temporary operator) to temporarily “manage and operate the business” of the former licensee (G. L. c. 23K, § 34(a); 205 CMR 130.02(1)). That appointment would be in place for as long as it took to find a replacement to permanently run the casino. There is long list of casino operators that would be interested in tapping into this New England market, according to Forbes.

Wynn would likely be able to meet its commitments to finish construction of the casino, but it would be overseen by a conservator until a new licensee is approved. That conservator would be approved by MGC and have full control of the books and records for the project. MGC would then initiate a accelerated suitability study for a new casino operator just in time for the anticipated June 2019 opening.

The MGC did not comment on any these reports.

Officials at Wynn are quiet, as well.

Everything appears to be hanging in the balance until the MGC issues its reports and the edicts that come with it.

Insiders are now claiming that report will be reported out in late September.

the case that the GMC will have to rule against Wynn Resorts if it is to keep continuity with its previous actions and thinking.

“For me,” said the source, “when Wynn’s chief lawyer Ms. Sinatra was forced out at 7 p.m. on a Friday afternoon out of the blue, that was a sign of other things to come,” he said.

He claimed that Sinatra was forced out moments after the GMC noti ed Wynn Resorts that “she needs to be gone or you will be gone.”

However, this source agreed that how the GMC acted previously doesn’t enter into the equation with Wynn Resorts because their stake is much too big and too much is at stake, that the city of Everett could go broke if the Wynn license is taken away.

The Forbes piece indicates the Wynn Resorts license could be taken away if the findings of the investigation are treated with gravitas.

Also, the Forbes piece, appearing in a national magazine, out distances anything the Globe has done or has failed to do regarding the controversy and the investigation.

“This recent investigation into the Wynn organization is going to be critical of the rights of its employees to speak up about any wrongdoing, not just harassment. As such, the culture of the organization will be a major part of the investigation and it will be revealing. Most certainly, Wynn has instituted changes…(but will they be enough) wrote Walter Pavlo in Forbes.

“MGC Chairman Stephen Crosby has noted that he is well aware of the impact that his decision could have on the city of Everett, a working class town known more for its industrial sites than tourist attractions. Most everyone can agree that this casino project has brought great paying construction jobs to the area and will result in residual jobs for many years. However, should MGC even consider the economic implications in their decision? It is not like they can say, ‘well, the casino operator is a charlatan, but he will bring jobs to the area.’ This does not make sense,” wrote Pavlo.

“The casino licensing project in Massachusetts, particularly the Everett/Boston site, has been controversial from the start. During Wynn’s struggle to gain the license, there were allegations that organized crime was involved in the ownership of the land on which the casino now sits. Though those were later proven to be untrue, they were unsettling to Steve Wynn who has been shadowed by accusations of association with organized crime members over decades in the gaming business. MGC asked Steve Wynn about the land in Everett during a rambling 6-hour interview it conducted on September 9, 2013 as part of its original suitability study. During that interview they asked Mr. Wynn about his knowledge of the ownership of the land in Everett, MA and he became angry.

He went on a tirade about his own reputation and how it towered above everyone else’s reputation.

He argued passionately that he’d have nothing to do with a land deal that was crooked and that for anyone to assume he knew anything about the players in on the land deal that they were terribly mistaken.

He painted a picture of himself as someone way beyond the fray – a picture he could never paint again given what has been revealed about him since he resigned.

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