Wynn Discusses Possible Sale of New Massachusetts Casino to MGM
(Bloomberg) -- Wynn Resorts Ltd. is in talks with MGM Resorts International to sell its nearly finished casino outside Boston -- a startling turn after the company won a battle to keep its casino license in the state.
“Over the past several weeks, we have engaged in conversations around the potential sale of Encore Boston Harbor,” Wynn and MGM said Friday in a joint statement. “They are very preliminary and of the nature that publicly traded corporations like ours often engage in.”
Massachusetts regulators late last month decided not to revoke Wynn’s license to do business in the state after investigating the company’s handling of sexual-misconduct allegations that felled co-founder Steve Wynn. The company plans to open the $2.6 billion Encore Boston Harbor late next month. The Boston Globe reported on the sale talks earlier Friday.
MGM operates a casino in Springfield, Massachusetts, about a two-hour drive from Boston.
The acquisition of a marquee property in Boston would bolster MGM’s growing presence on the East Coast. In recent years, the company has expanded with new properties outside Washington and in Springfield. The company also bought a racetrack casino near New York City and acquired full control of the Borgata in Atlantic City, New Jersey.
For Wynn Resorts, the sale would mark a retreat from a prize it sought for more than eight years, since Massachusetts first legalized betting. State law bars any company from owning two casinos, so MGM would likely have to sell the $960 million Springfield resort that opened only last year.
Wynn recently engaged in merger discussions with Australia’s Crown Resorts Ltd. The company embarked on the Boston property as part of a strategy by its former CEO to bring back grand hotels in major cities. But the Las Vegas-based casino operator has been more focused on international markets such as Macau and Japan, where it’s pursuing a casino license.
Concerns over a U.S.-China trade war have hurt shares of casino companies with big investments in Macau. Wynn shares fell as much 4.5% to $121.61 in New York. MGM, which has two Macau properties, was down as much as 2.4%.
“Our conversations will not impact the jobs at our facilities and will not impact the opening of Encore Boston Harbor,” Wynn and MGM said. “Regardless of where this leads us, we will ensure that our commitments will be met, and that those who welcomed us into their communities will not be disappointed.”
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