Hot Topics in Gambling Laws and Regulation LIVE Webcast

Speaker Firms and Organization:
Brownstein Hyatt Farber Schreck, LLP
Jennifer Carleton
Shareholder
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Presented By:
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December 9, 2014
Partner Firms:
Paul Hastings LLP
Behnam Dayanim
Partner

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Partner Firms:
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December 9, 2014
Paul Hastings provides innovative legal solutions to many of the world’s top
financial institutions and Fortune 500 companies in markets across Asia,
Europe, Latin America, and the United States. The firm offers a complete
portfolio of services to support clients’ complex, often mission-critical
needs—from structuring first-of-their-kind transactions to resolving
complicated disputes to providing the savvy legal counsel that keeps
business moving forward. With 20 offices located in the United States,
Europe and Asia, the firm is well-positioned to offer services across a range
of jurisdictions.
Founded in 1968, Brownstein Hyatt Farber Schreck practices in the areas of
gaming, corporate law, litigation, intellectual property, real estate, natural
resources and public policy. With 250 attorneys and legislative consultants in
offices across the western U.S., Atlantic City and in Washington, DC, the
firm works in industries ranging from hospitality, private equity and
telecommunications, to technology, construction, energy, banking and
finance and water. Recognized as one of the nation's premier gaming
practices ,Brownstein's Gaming Law Group assists clients in obtaining
approvals for gaming licenses, public offerings, financings, restructurings
and M&A. Our focus extends to large, complex, multi-jurisdictional
transactions throughout the U.S., Japan, Macau, Puerto Rico, Spain and
Great Britain.

Brief Speaker Bios:
Behnam Dayanim
Behnam Dayanim is a partner and chair of the Advertising, Gaming & Promotions Practice at the global law firm of Paul Hastings LLP,
where he also co-chairs the firm’s global Privacy and Data Security Practice. Mr. Dayanim has been recognized in Chambers Global
and Chambers USA as a leading gaming lawyer nationally and was named by Best Lawyers as the 2014-2015 Gaming Law Lawyer of
the Year for Washington, DC. Mr. Dayanim’s expertise includes internet, mobile and other forms of remote gaming, social gaming and
fantasy sports, gaming advertising and promotions, and payments regulation. His work includes advice on policy and regulation
involving gaming and payments, commercial transactions, litigation and agency investigations. Mr. Dayanim is based in Washington,
DC, and can be reached at 202.551.1737 or bdayanim@paulhastings.com.
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December 9, 2014
Jennifer Carleton
Jennifer counsels clients on corporate and regulatory matters, focusing on the licensing aspects of deal structures and transactions,
mergers and acquisitions, reorganizations, and public finance. She has spent the last 16 years of her career in gaming, first as in-house
counsel for an Indian casino and now as an adviser to the premier public and private gaming companies in the United States.
Jennifer has developed a unique multi-jurisdictional gaming practice, assisting clients with casino operations in numerous U.S. states,
advising investors in gaming companies that hold licenses worldwide, and facilitating negotiations with Indian gaming operators. She
represents investment management firms and their portfolio companies in obtaining regulatory approval to hold shares in publicly
traded gaming companies, and advises clients on the necessary structure and licensure for transactions involving casino gaming,
gaming manufacturing, cash access products, and Indian gaming.
► For more information about the speakers, you can visit: http://theknowledgegroup.org/event_name/employment-law-hot-topics-in-canada-in-2014-and-beyond-live-webcast/

This course offers an overview of the latest trends and updates with respect to the Laws and
Regulations in Gambling. A panel of thought leaders and practitioners will help firms better
understand how to apply this law or business trend to their company and/or clients.
Key topics include:
• Regulation of internet gambling in NV, NJ and DE: commonalities and differences
• Expanding payment channels in internet and bricks-and-mortar gambling
• Social casino and fantasy sports: are they legal and what’s next?
• Mergers and Acquisitions
• Industry Consolidation
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December 9, 2014

Featured Speakers:
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December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP
SEGMENT 2:
Jennifer Carleton
Shareholder

Introduction
Behnam Dayanim is a partner and chair of the Advertising, Gaming & Promotions Practice at the global law firm of Paul
Hastings LLP, where he also co-chairs the firm’s global Privacy and Data Security Practice. Mr. Dayanim has been
recognized in Chambers Global and Chambers USA as a leading gaming lawyer nationally and was named by Best Lawyers
as the 2014-2015 Gaming Law Lawyer of the Year for Washington, DC. Mr. Dayanim’s expertise includes internet, mobile
and other forms of remote gaming, social gaming and fantasy sports, gaming advertising and promotions, and payments
regulation. His work includes advice on policy and regulation involving gaming and payments, commercial transactions,
litigation and agency investigations. Mr. Dayanim is based in Washington, DC, and can be reached at 202.551.1737
or bdayanim@paulhastings.com.
10
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Internet Gambling, Social Casino and Fantasy Sports
11
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Agenda
 Regulation of Internet Gambling: commonalities and differences
 Focus on Payments
 Social casino gaming
 Fantasy sports
12
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Internet Gambling
13
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Legal Status of Unlicensed Gambling
 Default position is gambling is unlawful unless licensed
 Question: with internet gambling, where is gambling activity taking place?
 Pre-2006 defenses
– Wire Act and other federal laws
– “locus” of wager
– Dormant commerce clause
 Unlawful Internet Gambling Enforcement Act
– “unlawful internet gambling” is “bet or wager [that] is unlawful under any applicable Federal or
State law in the State or Tribal lands in which the bet or wager is initiated, received, or otherwise
made”
 Poker?
14
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Federal Laws
 UIGEA prohibition excludes
– Intrastate gambling expressly approved by the state
– The intermediate routing of electronic data are not considered in that determination
– Also exempts (certain) fantasy sports and horse-racing
 Wire Act prohibits using a wire communication facility (such as the telephone or internet) to transmit
“bets or wagers on any sporting event or contest.” 18 U.S.C. § 1084.
– Only sports (horses?)
 Thus, complying with state law for non-sports wagering satisfies federal law
– Interstate agreements?
15
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Internet Gambling Today
 Three states – NV, NJ and DE
 One territory - USVI
 Several other states are considering legislation
– California, New York, Pennsylvania most likely
16
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Similarities (Among States)
 All designed to satisfy UIGEA criteria
– Physical location of player
– Stringent KYC controls
 All allow for possibility of multistate agreements
– Only NV and DE have entered into such an agreement to date
 Stringent suitability review
 Licensing of service providers
– But not payments providers (mostly)
17
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Differences
 Games authorized
– NV, poker only
 Identities of licensees
– NV and NJ allow bricks-and-mortar licensees only
– DE lottery
– However, in each state, overseas operators obtain service-provider licenses
 “Bad-actor” prohibition
– Enshrined in NV statute
– Not expressly set out in DE or NJ statute or regulation
 License eligibility and “bad-actor” issues are sources of controversy in other states
18
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Payments in Internet Gambling
19
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Background
 Regulation GG (12 C.F.R. Part 233) diligence requirement
– Does commercial customer engage in internet gambling business?
• Business involving bets or wagers
– If not sure, certification that it is not
– If yes, customer must provide evidence of legal authority (“such as” license or RLO), plus third-party
certification of controls
 Credit card coding and enhanced diligence
 Result: high credit card rejection rates and bank resistance
20
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Direction of Payments
 Reality: compliance is not complex
– Small ecosystem of merchants
– Rigorous controls required as matter of gaming regulation
– Payment processors are not generally required to be licensed
 Card associations (MC/V) are responding
– New code for legal internet gaming
 Alternative payment methods are filling the vacuum as well
– ACH
– Prepaid cards and e-wallets
 Legalization in more states will incent banks to respond
21
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Social Casino Games and Online Sweepstakes
22
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Social Casino-Style Games
 Over the past 5+ years, there has been an emergence of casino-style social games such as slots,
poker, blackjack and roulette.
 Many companies have entered the social casino style games space in the last few years including
Zynga, Electronic Arts, IGT and Caesars.
 2014 est. revenue $1.52 billion (SuperData Research)
 2014 est. 85 million players
23
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Social Casino-Style Games
 Major Point of Difference:
– Cash or merchandise awarded?
24
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

State Laws
 Gambling generally requires 3 elements:
 Consideration: The payment of something is required to play the game
 Chance: The outcome of the game turns on chance, not skill
 Prize: Money, money’s worth or something of real-world/tangible value is awarded based on game
play
 Evaluation of these games requires assessment of those elements, which is not always simple or
straightforward
25
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Sweepstakes Café Laws
 North Carolina bans operation of electronic machines that “conduct a sweepstakes through the use of
an entertaining display”
– Machine “intended to be used by a sweepstakes entrant, that uses energy, and that is capable of
displaying information on a screen or other mechanism”
 Some laws clearly limit to placement in a business establishment (e.g., Ohio); others do not
26
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Limitations on Sweepstakes
 “Clearly occasional and ancillary to the primary business of that person”
– Michigan, Tennessee, New Mexico, Alabama
 Limits on mail-in AMOE
– Kansas, Connecticut
 Does AMOE solve problem at all?
– If some pay, may be an issue in some states
 What type of prize?
– Additional play?
27
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Implications?
 Level of intent required
– “specific” versus “general”
 Conspiracy, RICO, aiding and abetting
 Risk of forfeiture
 Reputational considerations
 Past actions (all in clear gambling contexts)
– Payment processors
– Marketing affiliates
– Internet security services
– Media companies (Yahoo, Google, Microsoft, Sporting News, Discovery Communications)
 “Reg GG” model
28
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Fantasy Sports
29
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Explosion of Fantasy Sports
30
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP
2013 - New Four-Week Player Challenge – Short-term action.

Explosion of Fantasy Sports
31
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP
FanDuel competitions last just one day - no season-long commitment.

 Fantasy Sports (FSTA)
 2014 est. revenue $3.6 billion, 2012 est. revenues $1.63 billion
 2014 est. 36.6 million players, 2012 est. 27 million players
32
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Federal Laws
 Wire Act – “sporting event or contest”
 PASPA, enacted in 1992, prohibits the operation, etc., “pursuant to the law or compact of a
governmental entity . . . [of a] lottery, sweepstakes, or other betting, gambling, or wagering scheme
based . . . on one or more competitive games in which amateur or professional athletes
participate, or are intended to participate, or on one or more performances of such athletes in
such games.”
 Does either prohibit fantasy sports?
33
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Federal Laws
 The UIGEA includes an express exemption for fantasy sports that have four necessary
characteristics:
– all prizes and awards must be made known to the participants in advance, and their value
cannot be determined by the number of participants or amount of fees paid by
participants;
– all winning outcomes are determined predominantly by accumulated statistics;
– no winning outcome is based on the score, point-spread or performance of any single real-world
team; and
– no winning outcome is based solely on the single performance of an individual athlete.
 “Safe harbor” only for UIGEA, not other laws
34
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Fantasy Sports
 At state level, not enough to look only at statutes
– AG opinions also can shed light on law, but not binding
 A few states have addressed fantasy sports specifically
– Montana imposes limits by statute, including cap on administrative fee of 15%
– Louisiana AG in 1991 found a 900 fantasy league to violate state gambling laws
– By contrast, Maryland statute expressly allows fantasy sports
– New Jersey regulation states that “the conduct of a fantasy sports tournament shall not be
considered ‘gaming’ or ‘gambling’….”
• Technically, applies only to casinos and other licensees
35
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

The Humphrey Case – 2007 (D.N.J.)
 Principal court decision to evaluate legality of fantasy sports
 Qui tam case (recovery of money “lost” on “bets” or “wagers” on games of chance)
– DC, GA, IL, KY, MA, NJ, OH, SC law
 Three common elements to games
– Entry fee paid unconditionally
– Predetermined prizes guaranteed to be awarded*
– Operators could not win prizes themselves
 Chance or skill not relevant
 FanDuel prevailed in a 2013 Illinois action
– Suit was dismissed on other grounds
36
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Issues
 Skill versus chance?
– Length of game
– Number of players on roster
 Prize determined by number of participants or amount of entry fees (or comprised of entry fees)?
– Head-to-head?
– Solo?
37
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP

Introduction
Jennifer counsels clients on corporate and regulatory matters, focusing on the licensing aspects of deal structures and
transactions, mergers and acquisitions, reorganizations, and public finance. She has spent the last 16 years of her career in
gaming, first as in-house counsel for an Indian casino and now as an adviser to the premier public and private gaming
companies in the United States.
Jennifer has developed a unique multi-jurisdictional gaming practice, assisting clients with casino operations in numerous
U.S. states, advising investors in gaming companies that hold licenses worldwide, and facilitating negotiations with Indian
gaming operators. She represents investment management firms and their portfolio companies in obtaining regulatory
approval to hold shares in publicly traded gaming companies, and advises clients on the necessary structure and licensure
for transactions involving casino gaming, gaming manufacturing, cash access products, and Indian gaming.
In 2012, Jennifer was named one of the Ten Women Who Mean Business by the Las Vegas Business Press. She is a
member of the Executive Committee of the Gaming Law Section of the State Bar of Nevada, and a trustee for the Discovery
Children’s Museum in Las Vegas. She has published articles on gaming investment in the William S. Boyd School of Law -
University of Nevada Gaming Law Journal, the Nevada Gaming Lawyer, and Casino Enterprise Management Magazine, as
well contributing a chapter on Indian gaming licensing and regulation to Inside the Minds: Emerging Issues in Tribal-State
Relations. Jennifer received her J.D. from the University of Wisconsin School of Law, where she graduated cum laude and
her B.A. from Indiana University, where she graduated with honors.
38
December 9, 2014
SEGMENT 2:
Jennifer Carleton
Shareholder

HOT TOPICS IN GAMBLING LAWS AND REGULATION
• Mergers and Acquisitions
• Industry Consolidation
39
December 9, 2014
SEGMENT 2:
Jennifer Carleton
Shareholder

SEGMENT 2:
Jennifer Carleton
Shareholder
2013/2014 Gaming Mergers over $1 billion
40
December 9, 2014
Acquiring Company Acquired Company Acquisition Price
Pinnacle Entertainment Ameristar $2.8 billion
Scientific Games Corporation WMS Industries $1.5 billion
Bally Technologies SHFL Entertainment $1.3 billion
GTech IGT $4.7 billion
Amaya Rational Group $4.9 billion
Aristocrat Leisure Limited VGT $1.3 billion
Scientific Games Corporation Bally Technologies $3.3 billion
Global Cash Access Multimedia Games $1.2 billion

Consolidation
• The gaming industry pursues consolidation to increase growth
• Declining share values increase the likelihood of future mergers
• As the number of deals announced in recent months indicates, there is financing available when the
share price of the target is perceived to be undervalued and the buyer is an established industry
participant
41
December 9, 2014
SEGMENT 2:
Jennifer Carleton
Shareholder

SEGMENT 2:
Jennifer Carleton
Shareholder
Acquired Company Share Price
42
December 9, 2014
Acquired Company Share Price the Day Before Acquisition
Announced
Acquisition Share Price
Ameristar (ASCA) $22.07 (12/20/12) $26.50 (20% premium)
WMS Industries (WMS) $16.37 (01/30/13) $26.00 (59% premium)
SHFL Entertainment (SHFL) (07/15/13) $23.25 (24% premium)
IGT (IGT) $15.50 (07/15/14) $18.25 (18% premium)
Rational Group N/A N/A
VGT N/A N/A
Bally Technologies (BYI) $60.17 (07/31/14) $83.30 (38% premium)
Multimedia Games (MGAM) $27.78 (09/05/14) $36.50 (31% premium)

SEGMENT 2:
Jennifer Carleton
Shareholder
Acquiring Company Share Price
43
December 9, 2014
Acquiring Company Closing Share Price the Day
Before Acquisition
Announced
Closing Share Price the Day After
Acquisition Announced
Closing Share Price the Day
Acquisition Closes
Pinnacle Ent. (PNK) $13.35 (12/20/12) $15.95 (12/24/12) $21.85 (08/14/13)
Scientific Games (SGMS) $8.93 (01/30/13) $9.42 (02/01/13) $18.42 (10/18/13)
Bally Technologies (BYI) $60.91 (07/15/13) $67.13 (07/17/13) $72.23 (11/25/13)
GTech (GTK.MI) $18.44 (07/15/14) $18.89 (07/17/14) $18.40 (as of 10/20/14)
Amaya (AYA) $9.81 (06/11/14) $18.35 (06/13/14) $26.48 (08/05/14)
Aristocrat (ALL.AX) $5.39 (07/04/14) $5.39 (07/07/14) $6.20 (10/20/14)
Scientific Games (SGMS) $8.54 (07/31/14) $8.89 (08/04/14) $9.41 (as of 10/20/14)
Global Cash Access (GCA) $7.52 (09/05/14) $7.85 (09/09/14) $6.80 (as of 10/20/14)

Unique Aspects of Gaming Acquisitions
• Regulatory approval of a gaming acquisition includes both antitrust review and gaming regulatory
licensing and suitability
• Hart-Scott-Rodino (“HSR”) filings required at the Federal Trade Commission (“FTC”) and the
Department of Justice (“DOJ”) for certain acquisitions of assets or securities
• Notice to and, in some cases, approvals required by federal, state and tribal gaming regulators,
depending on the type of gaming license or finding of suitability held by the acquiring company and the
acquired company
• Additional notice and potential gaming approvals depending on financing
44
December 9, 2014
SEGMENT 2:
Jennifer Carleton
Shareholder

HSR Merger Review
• Under the Hart-Scott-Rodino Act, the FTC and the DOJ review most of the proposed transactions that
affect commerce in the United States and are over a certain size, and either agency can take legal
action to block deals that it believes would “substantially lessen competition.” Although there are some
exemptions, for the most part current law requires companies to report any deal that is valued at more
than $75.9 million to the agencies so they can be reviewed
• http://www.ftc.gov/news-events/media-resources/mergers-and-competition/merger-review
45
December 9, 2014
SEGMENT 2:
Jennifer Carleton
Shareholder

HSR – Pinnacle/Ameristar Acquisition
• PNK announced that it was acquiring Ameristar Casinos for $2.8 billion, with the proposed price per
share represented a 45% increase over the average closing price of Ameristar common stock
• FTC issued an administrative complaint against both companies alleging that the deal would violate
U.S. antitrust law
• Ultimately, Pinnacle divested assets in St. Louis and Lake Charles in order for the acquisition to close
46
December 9, 2014
SEGMENT 2:
Jennifer Carleton
Shareholder

SEGMENT 2:
Jennifer Carleton
Shareholder
HSR – Manufacturer and Technology Acquisitions
• Focus in 2013 and 2014 has been on manufacturing and technology companies where antitrust issues
are less of a concern
• Early HSR approval has become the norm
47
December 9, 2014
Acquiring Company Acquired Company HSR Approval
Pinnacle Entertainment Ameristar 12/21/12 to 12/19/13 (1 year)
Scientific Games Corporation WMS Industries 1/30/13 to 3/12/13 (6 weeks)
Bally Technologies SHFL Entertainment 7/16/13 to 8/27/13 (6 weeks)
GTech IGT 7/16/14 to 8/11/14 (4 weeks)
Amaya Rational Group Information unavailable
Aristocrat Leisure Limited VGT Information unavailable
Scientific Games Corporation Bally Technologies 8/1/14 to 8/20/14 (3 weeks)
Global Cash Access Multimedia Games 9/8/14 to 9/26/14 (2 weeks)

Confidentiality
• The Office of Fraud Detection and
Market Intelligence of the Financial
Industry Regulatory Authority
(“FINRA”) may conduct a review of
trading in the acquired company’s stock
surrounding the announcement of the transaction
• FINRA routinely requests that the acquiring company provide a detailed, written chronology of the
events leading up to the announcement of the transaction, including a list identifying all persons within
and outside of the acquiring company that were privy to information about events leading up to the
transaction prior to its public dissemination
48
December 9, 2014
SEGMENT 2:
Jennifer Carleton
Shareholder

Gaming Regulatory Review – Key Preliminary Questions
• Controlling documents – how are gaming and regulatory approvals addressed?
• What are the applicable timelines?
• Are there financial consequences or tolling fees applicable to a closing delay?
• Will there be changes to the officers or directors post-acquisition?
• Will there be new significant shareholders (usually over 5%) post-acquisition?
49
December 9, 2014
SEGMENT 2:
Jennifer Carleton
Shareholder

Gaming Regulatory Review – Where is the Acquiring Company Licensed?
• GTECH, the world’s largest provider of lottery systems, is subject to regulatory licensing and oversight
in more than 250 gaming jurisdictions throughout the world. These licenses undoubtedly gave GTECH
an advantage over other potential purchasers in its $6.4 billion acquisition of IGT, the world’s biggest
slot-machine maker, reportedly licensed by more than 300 gaming jurisdictions
• Scientific Games and WMS hold combined licenses or findings of suitability in more than 400
jurisdictions, easing the regulatory review of Scientific Games’ proposed acquisition of Bally
Technologies by the 300 gaming jurisdictions in which Bally holds a license
50
December 9, 2014
SEGMENT 2:
Jennifer Carleton
Shareholder

Gaming Regulatory Review – Where is the Target Licensed?
• Start with notice to ALL jurisdictions
• Identify jurisdictions that will require prior approval in order to effectuate change in control and how long
it will take to obtain this approval
• Identify licensing and suitability thresholds for shareholders, officers and directors
• Identify limitations on financing, voting and other key regulatory issues to be addressed in definitive
agreements
51
December 9, 2014
SEGMENT 2:
Jennifer Carleton
Shareholder

SEGMENT 2:
Jennifer Carleton
Shareholder
Hidden Issues that can Stall a Regulatory Review
52
December 9, 2014
• How is the transaction being financed?
• What assets are being pledged?
• Will the company being issuing stock?
• Will the transaction result in shareholders over 5%?

When Licensing Drives the Transaction
• The Rational Group, owner and operator of the PokerStars and Full Tilt Poker brands, was
unsuccessful in its 2013 efforts to enter the U.S., first through the proposed purchase of the Atlantic
Club Casino, and then through a partnership with Resorts Casino. In both cases, the New Jersey
Division of Gaming Enforcement (“DGE”) expressed concern over the suitability of Rational
• Under its agreement with Amaya, certain Rational Group principals must sell their stock and resign from
the company and all of its subsidiaries
• Amaya and the DGE have been reported to now be negotiating PokerStars’ suspended license
application
53
December 9, 2014
SEGMENT 2:
Jennifer Carleton
Shareholder

Current U.S. Gaming Company Sales
• Deutsche Bank announced on 5/15/14 that it was selling The Cosmopolitan of Las Vegas to a
subsidiary of the Blackstone Group for $1.73 billion
• On 6/30/14 Goldman Sachs announced the sale of the Las Vegas Hotel to Westgate Resorts. It is
estimated that the purchase price is $150 million to $170 million
• Trump Entertainment Resorts, which owns and operates Trump Taj Mahal Casino Resort and Trump
Plaza Hotel and Casino in Atlantic City, filed for bankruptcy 9/9/14
54
December 9, 2014
SEGMENT 2:
Jennifer Carleton
Shareholder

Current U.S. Gaming Company Sales and Developments
• A federal bankruptcy court has approved the $110 million sale of Atlantic City’s Revel Casino, closed
since 9/2/14, to Brookfield Asset Management Inc., a Toronto asset management firm
• Full House Resorts Inc., which owns the Rising Star Riverboat Casino in Indiana, the Silver Slipper
Casino in Mississippi, and Stockman's Casino in Nevada, announced 10/22/14 that it is putting itself up
for sale
• James Packer, CEO of Crown Resorts Ltd., is forming a company with ex-Wynn Las Vegas President
Andrew Pascal and Oaktree Capital Management to construct a hotel-casino on the Las Vegas strip
55
December 9, 2014
SEGMENT 2:
Jennifer Carleton
Shareholder

What’s Next?
• With the number of manufacturing and lottery companies growing smaller every quarter, the next wave
of gaming mergers is likely to involve larger-scale social and mobile gaming and payment processing in
addition to competitive brick-and-mortar acquisitions
• Mid-size gaming companies with established brands, internet platforms or cash management
components are the most likely merger targets
56
December 9, 2014
SEGMENT 2:
Jennifer Carleton
Shareholder

57
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December 9, 2014
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December 9, 2014
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December 9, 2014
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60
December 9, 2014
SEGMENT 1:
Behnam Dayanim
Partner
Paul Hastings LLP
bdayanim@paulhastings.com
202.551.1737
SEGMENT 2:
Jennifer Carleton
Shareholder
jcarleton@bhfs.com
702.464.7086

61
December 9, 2014
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