http://business.guardian.co.uk/story/0,,2154140,00.html
Clark in New YorkWednesday August 22, 2007 Guardian Unlimited
The state-controlled investment vehicle of Dubai is betting on the glitzy fortunes of Las Vegas by pumping $5bn (£2.5bn) into a partnership to develop casinos with MGM Mirage - in spite of the fact that the emirate officially forbids gambling.
Dubai World, which is controlled by the Middle Eastern emirate's government, is putting $2.7bn into a 76-acre resort on the Las Vegas Strip and will buy up to $2.4bn worth of MGM shares.
The deal amounts to a coup for Kirk Kerkorian, the 90-year-old billionaire who owns a controlling stake in MGM and who has been building Las Vegas landmarks since the 1940s.
Due to be completed in 2009, the partnership's initial project is named CityCenter and will comprise a 4,000-room resort casino, two non-gambling hotels, 2,650 apartments and 470,000ft of retail space. Architects involved in the project include Lord Foster.
Although an Islamic nation, Dubai is renowned for its liberal policies. But while alcohol is tolerated, gambling is strictly forbidden for the emirate's 1.4 million residents.
Dubai World's chairman, Sultan Ahmed bin Sulayem, brushed aside questions about the apparent conflict of attitudes by pointing out that the company had long owned a small stake in Kerzner International - the owner of the Bahamas' Paradise Island casino.
"Through our Kerzner investment we're already into gambling, so this shouldn't come as a surprise," he told the newswire service Bloomberg.
The scale of the Las Vegas deal, however, eclipsed Dubai World's previous gaming involvement and Sultan bin Sulayem suggested the firm would like to increase its stake in MGM to 20% once it receives approval from gaming regulators.
Dubai World's activities in its home nation include building two luxurious off-shore residential projects - The World and the Palm. The company's recent overseas ventures include purchasing the QE2, the W Hotel in New York's Union Square and the department store Barneys.
Two years ago, Dubai World's ports offshoot, DP World, snapped up P&O for £3.9bn but was forced to offload P&O's six US ports following a campaign by opponents including Hillary Clinton who claimed that Arab ownership of American ports was a national security risk.
MGM shares leapt 7% to $79.87. The US company's chairman, Terry Lanni, described the deal as "a transforming event for MGM Mirage and Las Vegas".
"We are extremely pleased to be working with Dubai World," he said. "We have a tremendous amount of respect for Sultan bin Sulayem and all that his company has accomplished."
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13 comments:
Isn't this sort of thing against the moral, religious values of the UAE? Most gambling sites are blocked....Or is it okay when you're making a lot of money out of it...
Betcha, Ben (Bugsy) Siegel is smiling from his grave, seeing his brainchild to convert a small strip of desert into a gambler’s paradise invoke so much interest. That too from another desert kingdom across the oceans!
Way go to Bugsy!
The article is misleading. There was no real mention that CASINOS are being developed. The real story is that they have invested in MGM Mirage, for hotels and such, nothing more. Casinos, neither by MGM Mirage or Dubai World, are explicitly stated as being in the pipeline.
Actually Anon (14:08) the article does mention casinos:
"Due to be completed in 2009, the partnership's initial project is named CityCenter and will comprise a 4,000-room resort casino, two non-gambling hotels, 2,650 apartments and 470,000ft of retail space."
(link)
MGM Mirage is a casino!!!!
For the Anon who has trouble scrolling... please scroll down and read
[...]Dubai World's chairman, Sultan Ahmed bin Sulayem, brushed aside questions about the apparent conflict of attitudes by pointing out that the company had long owned a small stake in Kerzner International - the owner of the Bahamas' Paradise Island casino.
"Through our Kerzner investment we're already into gambling, so this shouldn't come as a surprise," he told the newswire service Bloomberg.
The scale of the Las Vegas deal, however, eclipsed Dubai World's previous gaming involvement and Sultan bin Sulayem suggested the firm would like to increase its stake in MGM to 20% once it receives approval from gaming regulators.[...]
well Dubai was BOUND to goto the gambling business, old news!
wait and see, Dubai will have its up running casino somewhere in jumeira in no time :)
Nice blog, came across first time. :)
The Dubai World have said today they invested for the sake of hotel business of MGM. MGM has few of non-gaming hotels across the world.
Wallahu-Aalam, of their intentions. If they really went into gambling, people of UAE can take charge by taking off invested shares.
Karim,
MGM Mirage is one of the leading casino companies and is owned by the legendary investor Kerk Kerkorian (a Jew, by the way).
Dubai World has publicly stated that they have no issues investing in a gambling company since they are already in partnership with the Kerzner Group (another Jew, by the way) who are building the Atlantis hotel resort in Palm Jumeirah.
And what do you mean by "taking of invested shares". Dubai World is not owned by UAE citizens....it's owned by just a couple of UAE citizens (i.e. rulers of Dubai).
Who cares if it's Jews or whoever--no one is suggesting here that Dubai business concerns are anti-Jewish and I don't believe Islam as such is anti-Jewish, while it is probably more clearly opposed to gambling.
So, the suprise is not that Dubai does business with Jews but that they would become so closely involved with a gambling interest.
In any event, the name of the game for Dubai is business. Perhaps this is a way for Dubai World to develop the acumen to offer gambling in Dubai. I think it certain it will at some point make it here and could be easily housed on one of the islands of the World, for example, allowing the government to maintain that it is in a very special restricted zone.
This is Anon 14:08. I mis-stated my statement before. I meant to say that only the Guardian is mentioning casinos explicitly, while every other article I've read about this only mention the hotel aspect of it, or the fact that the chain is a leader in casinos, but the Guardian is the only newspaper I've seen that mentions "building a casino" explicity. My mistake on my vagueness.
Isn't the whole of the Emirates, and especially DUbai, a whole gamle in and of itself ? :-)
Anonymous. The papers are trying to avoid mentioning the c and g words. For very obvious reasons, although they've all managed to slip it somewhere into the story.
But as has been mentioned. MGM Mirage is gambling, its what they do. It's how they make most of their money.
I always said Bawadi would have gambling...
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