Wednesday, September 29, 2010

Ameristar complains that competing Sugar Creek casino would be bad for Ameristar

Posted By on Wed, Sep 29, 2010 at 8:00 AM

Ameristar knows what's good for Missouri Ameristar.
  • Ameristar knows what's good for Missouri Ameristar.
Ameristar knows what's good for Missouri Ameristar.
Ameristar Casinos has released an "analysis" that predicts financial doom should state regulators approve a casino for Sugar Creek. But it's hard to take seriously when the people doing the analyzing would be the ones doomed by the competition.

State regulators are weighing where, if anywhere, they should allow a

13th casino, which would hold the Missouri's last gambling license. The proposed casinos still in the running are in St. Louis, Cape

Girardeau and Sugar Creek, 10 miles east of Kansas City.



Ameristar, which runs casinos in St. Louis and KC, wants the state to approve the Cape Girardeau site -- and for obvious reasons. Any new casino in one of the state's major markets would eat into Ameristar's profits, infringing on company executives' God-given right to give out Vespas to Halloween trick-or-treaters.

But while it's obviously within Ameristar's right to fear and loathe competition, it's bizarre to release an "analysis" and expect people to believe its math. Here's what it's claiming, according to the Kansas City Business Journal:

The

Las Vegas-based company (Nasdaq: ASCA), which operates gambling houses

in Kansas City and St. Louis, said Tuesday that it estimated a new Cape

Girardeau facility would generate $88.7 million in annual adjusted gross

revenue.

More important, Ameristar said almost none of that would come at the

expense of other casino operations in Missouri. The closest casino to

Cape Girardeau is 80 miles away in Caruthersville.

On the other hand, the company said that a proposed casino in Sugar Creek would cannibalize 81 percent of its revenue from other Kansas City-area casinos and that two St. Louis-area proposals would take 66 percent to 72 percent of its revenue from that city's casinos.

The Missouri Gaming Commission will hear from the public today (Wednesday) in Sugar Creek. It will pick the winner by year's end.

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