MGM Mirage Won't Desert Pansy Ho and $1B IPO

(MoneyWatch)  MGM Mirage is considering selling off its half-ownership of the Atlantic City Borgata Hotel Casino & Spa after New Jersey regulators are questioning its relationship with Asian businesswoman Pansy Ho, daughter of Macao casino mogul Stanley Ho. As I previously wrote for BNET, Stanley Ho is suspected of ties to Chinese organized crime, although he has never faced criminal charges and both MGM and his daughter repeatedly deny that Stanley Ho has no involvement in the MGM Grand Macau.

Last May, the New Jersey Division of Gaming Enforcement didn't seem to hear the denials and still wants MGM Mirage to either break up with its Macao joint venture partner or give up the most profitable casino in Atlantic City. The gaming officials called the partnership "unsuitable" in federal regulatory filings. If the Casino Control Commission agrees with the DGE, it could deny Pansy Ho a casino license or order MGM to sever their relationship.
In the Wall Street Journal, it was suggested (by two unnamed sources) that MGM Mirage hopes its plans to sell off its share of the hotel would prompt the commission to drop its scrutiny. All its machinations are being done to prevent a hearing before the commission. Pansy Ho, after a two-year review, was previously cleared of any potential conflicts by Nevada regulators.

In essence, MGM Mirage is waiting to see if the New Jersey regulators will call their bluff. If they do, and still persist in labeling Pansy Ho an unsuitable or unsavory partner, MGM can always sell and leave Atlantic City. Because even if it's the most profitable casino in Atlantic City, MGM would never sever its partnership in MGM Macau Grand and the possibility of a $1 billion IPO. If push comes to shove, MGM Mirage can only leave New Jersey.

Photo of Pansy Ho (and Cyril Takayama) courtesy of Macau.com