PokerStars’ Atlantic Club Casino Acquisition Deal Expires
The acquisition deal between The Rational Group, parent company of Full Tilt Poker and PokerStars, and the Atlantic Club Casino Hotel, located in Atlantic City in New Jersey, has failed, owing to which PokerStars will have to look for another way to get back into a regulated gambling market in the US.
The news of the deal having been scrapped was first broken by John Brennan of NorthJersey.com, who posted about it on his blog called “Meadowlands Matters.” Although early reports had stated that it was a $50 million deal, Brennan said that PokerStars could have acquired the Atlantic Club Casino Hotel for just $11 million.
Michael Frawley, CEO for the Atlantic Club, is reported to have told Brennan: “…our purchase agreement with PokerStars has been terminated. The Atlantic Club remains committed to the aggressive pursuit of the opportunities presented by online gambling.”
One of the oldest land casinos in Atlantic City, The Atlantic Club was constructed in 1980 by Michael Milken and the Golden Nugget Companies owned by Steve Wynn. Original christened as the Golden Nugget, it was sold several times before getting its present name in 2012. The casino had gone through a number of financial difficulties before getting into an acquisition deal with PokerStars as the only way to stay afloat and save 2,000 people from unemployment.
The purchase process was a long procedure, and initially, Rational Group had to apply for an interim casino authorization (ICA), a process which came to an end just two weeks back. However, the American Gaming Association (AGA) filed a petition before the New Jersey Division of Gaming Enforcement (NJDGE) and the New Jersey Casino Control Commission (CCC), expressing its objection to the application and urging that the PokerStars should not be granted an ICA as it had operated in the US in violation of its gambling laws.
The AGA said: “The ICA is designed to expedite conditional licensing of qualified licensees, not open the door into New Jersey’s gaming industry for applicants who cannot meet the law’s standards for integrity and honesty.”
Raph Caputo, a New Jersey politician, supported the AGA and is reported to have said that PokerStars’ interest in acquiring an Atlantic City casino is disconcerting for the people of New Jersey because the company has been accused of money laundering, illegal gambling, wire fraud, and bank fraud, adding that its founder is wanted by the feds for all these charges. He said, “New Jersey is known for its rigorous standard licensing practices. To become involved with a company like this one would have been an insult to everyone who has gone under scrutiny to work or do business in the casino industry over the last 30 years.”
However, Senator Raymond Lesniak, one of the largest supporters of online poker, is not that happy about this development. He said that over 2,000 people will become unemployed if the Atlantic Club cannot find a company willing to invest in it and this will have a major impact on the state’s economy and the casino’s recovery.