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MGM Resorts Drops Plans To Acquire Sands Bethlehem Casino

The proposed deal involving the purchase of Sands Casino Resort Bethlehem by MGM Resorts International has fallen through according to sources. The $1.3 billion deal would have resulted in Pennsylvania’s top casino changing hands from Las Vegas Sands to the world’s second largest casino operator MGM Resorts.

The news of the deal first came out in March this year. Sands Bethlehem CEO Mark Juliano reportedly sent a letter to the employees stating that the property had a prospective buyer. No confirmation of the talks was received from MGM Resorts or Sands at that time.

Several industry experts pointed out that the deal would have helped Las Vegas Sands to exit from the only regional casino in its portfolio, while enabling MGM Resorts to expand its footprint in the region. Las Vegas Sands Corp. spokesman Ron Reese stated that Las Vegas Sands would continue operating the Bethlehem casino.

In a recent earnings call held with analysts regarding first-quarter results, Sands President Robert Goldstein noted that the Bethlehem property was smaller than the company’s other properties but was proving to be an extraordinary investment.

No reasons have been given for the collapse in talks. Some analysts have cited a gaming law amendment that’s currently under discussion as the reason. The amendment is looking to expand gambling in the state by legalizing new gaming formats like fantasy sports leagues, internet gambling and allowing slots in places like airports. The state legislature is expected to vote on the bill later this week.

Although Reese refused to comment on the sale talks, he did confirm that Las Vegas Sands was concerned about the gambling expansion. Sands Bethlehem opposes gambling options outside casinos including online gaming as it believes it will affect its revenues.

Juliano has highlighted in the past that legislative proposals pushing for gambling expansion were likely to hurt the state’s successful casino model which yields $1.4 billion in state taxes and employs over 18,000 people. The sale discussion also put a halt to the $90 million expansion plan being initiated by Sands Bethlehem. The expansion would have seen development of additional gaming space and other entertainment amenities in the complex.

Reese has acknowledged that the plan might be dropped if the state expands gambling. Bethlehem City Mayor Robert Donchez has emphasized the importance of developing available land in the vicinity. In a statement Donchez said,

It's very important for the Sands or MGM to continue developing the site, and if they are not interested in developing the site, consider selling off parcels to developers who are

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