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With MGM buying out Borgota, will I still use my Borgta players card or will I use my M life card?
A:
Since the MGM Resorts International purchase of Boyd Gaming's half of Borgata isn't expected to close until the third quarter of 2016, we'd suggest that you hang onto your Borgata player's card at least that long. Once MGM takes full title to the property (of which it currently holds a passive 50 percent ownership), then it will be a different story. As MGM CEO Jim Murren said, in announcing the takeover, "We are excited about the opportunity to bring our market-leading loyalty program, M life Rewards, to the resort and integrate our operations, to position Borgata for further growth."
The impending change of ownership at Borgata is ironic indeed: As recently as two years ago, MGM's stake in the Borgata was being held in trust while it tried to find a taker for its half of the property. (Nobody came forward with a serious offer – or any offer of which we're aware.) When the New Jersey Division of Gaming Enforcement (DGE) made peace with MGM in September 2014, the company received the previously blocked revenues and resumed participation in the operations of the megaresort going forward, culminating in this week's blockbuster announcement.
One of the reasons that players will have to switch loyalty programs is that Boyd Gaming was the operator of Borgata, with MGM co-financing the property but otherwise just along for the ride. Now that MGM will be assuming operational responsibility, Boyd's Borgata Rewards – which had no relationship with Boyd's B Connected loyalty program – will be phased out and M life will ultimately replace it.
But how come MGM was trying to sell its Borgata share as recently as 2014? Therein hangs a tale, one that has nothing to do with Atlantic City. MGM Mirage, as it was then known, was trying to enter the Macao market – which dwarfs Las Vegas and Atlantic City combined -- slightly more than a decade ago and the easiest means of doing that was to purchase the sub-concession held by Stanley Ho's Sociedade de Jogos de Macau (SJM). One of the conditions of obtaining SJM's sub-concession was taking on Stanley's daughter Pansy as a 50/50 partner, a position she purchased with money given to her by Dear Old Dad.
The problem with Stanley and Pansy Ho was that both were perceived to be mobbed up, connected to Chinese Triads – the elder Ho especially. A DGE investigation found that previous MGM CEO Terrence Lanni and two other company executives conspired to conceal many of their dealings with Stanley Ho from MGM's compliance committee. (Lanni had left the company by this time.) On the basis of this, and its conclusion that Pansy Ho was a 'beard' for her father, the DGE presented MGM with an ultimatum: It could retain its New Jersey gaming license or surrender it in favor of Macao. Given the money to be made in China, MGM chose the latter course of action.
That was in March 2010. MGM's half of Borgata sat in trust, along with some nearby land that the company owned but still has not developed. In time, events turned in MGM's favor. The bad actors in the Stanley Ho affair all had left or were forced out of the company, Pansy Ho sold down her MGM Macau holdings to 29 percent of the property and, frankly, New Jersey needed MGM back in the fold as a corporate citizen. The New Jersey Casino Control Commission pronounced MGM to be of good standing again and reinstated its gaming license.
While MGM will probably never go through with its plan for a new, standalone megaresort in Atlantic City, an idea abandoned during the Great Recession (and besides, it is much cheaper to buy an Atlantic City casino than to build one nowadays), it has been looking eastward considerably of late.
In addition to its Borgata coup, MGM is building a $950 million casino in Springfield, Massachusetts, along with $1.3 billion MGM National Harbor, a resort that will sit in sight of Washington, D.C., just over the Maryland side of the border. And Murren has been aggressive in courting Georgia legislators, seeking to have the first casino in Atlanta. He didn't succeed in the latest legislative session but an LVA source tells us that once anti-gambling Gov. Nathan Deal is out of office, lawmakers will have a change of heart.
MGM has even been tipped as a bidder for one of two casino licenses that could be available in northern New Jersey, if a November referendum passes. However, by doubling down on Borgata, MGM has effectively quashed that speculation, at least for the near term.
In the meantime, MGM will have plenty to do in terms of integrating Borgata customers, player-tracking systems, management personnel, etc., into the new regime. So if you live near Atlantic City and have an M life card, it suddenly became a lot more useful.
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Originally Posted by irisheyes
