At least two national gaming industry operatives and one Massachusetts Gaming Commissioner are exploring the ramifications of MGM Resorts International's rumored interest in purchasing Wynn Boston Harbor, MassLive has learned.
Multiple media outlets have reported that MGM, whose $960 million Springfield casino is scheduled to open this fall, has entered preliminary talks about purchasing Wynn's Everett casino project.
MGM's interest comes as Wynn awaits the results of the Massachusetts Gaming Commission's investigation of sexual misconduct allegations against former CEO Steve Wynn, who resigned from the company he founded following a Wall Street Journal report that revealed he had paid a $7.5 million sexual harassment settlement to an employee in 2005.
The Gaming Commission and MGM have declined to comment on the rumored deal, which would radically alter the state's gaming landscape. No company may own more than one casino license in Massachusetts, meaning that MGM would have to choose between the Springfield project and the Boston Harbor project should it purchase Wynn's $2.5 billion Everett casino.
But behind the scenes, outside gaming operators and one state regulator have begun preparing for a potential future in which MGM moves from Western to Eastern Massachusetts, according to a gaming industry source with first-hand knowledge of those conversations.
The source, who requested anonymity due to the sensitivity of the discussions, said that two site scouts for national gaming companies had begun asking Massachusetts industry players about the possibility of taking over the Springfield project.
The scouts -- freelance operatives who acquire information about potential casino developments on behalf of gaming companies -- were still in preliminary stages of their inquiries but appeared to consider the deal a genuine possibility, the source said.
The rumors have also piqued the interest of a member of the Massachusetts Gaming Commission, who the source would not identify. The commissioner has begun asking industry insiders about the potential acquisition, according to the source.
In a statement, Wynn CEO Matt Maddox did not discuss the rumored deal but also did not deny that talks were taking place.
"Our company stands for quality and five-star service and is uniquely situated to deliver one the best integrated resorts in the world for both customers and employees in Everett, Massachusetts. We remain very excited about the Boston market," Maddox said. "However, our obligation to shareholders is always to maximize the value of our assets and to mitigate risk. These obligations are particularly relevant in light of recent commentary that was made despite our rapid and decisive efforts to sever all ties with our former Chairman, actively searching for new diverse board members, and fully cooperating with the regulators in Massachusetts and elsewhere."
Maddox did not specify what "commentary" he was referring to. Gaming Commission Chair Steve Crosby has said that Wynn is proceeding with the project on an "at risk" basis as the commission reviews whether the company remains suitable to hold a gaming license.
Crosby also said Thursday the commission will evaluate whether Wynn has any "residual influence" over his former company, as it considers a request from the company to strike Wynn from its license.
Massachusetts' 2011 gaming law makes clear that MGM could not operate both casinos at the same time.
"No person or affiliate shall be awarded, purchase or otherwise hold or have a financial interest in more than 1 gaming license issued by the commission," the statute says.
Any deal would also have to navigate the terms of MGM's host-community agreement with Springfield, which provides that MGM cannot "transfer this Agreement or the Project without the prior written consent of the City" except to its own subsidiaries.
"I have consulted with our legal team and we are satisfied with our Host Community Agreement protections," Springfield Mayor Domenic Sarno said in a statement. "I don't want to speculate on what MGM might or might not do. I have been contacted by MGM Resorts International President Bill Hornbuckle and MGM Springfield President and C.O.O. Mike Mathis to reassure me of their continued commitment to a first class resort in Springfield."
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