Full House Resorts

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Full House Resorts, Inc.
Public
Traded as NASDAQ: FLL
Industry Gaming
Founded 1987
Headquarters Spring Valley, Nevada
Number of locations
 5 casinos
Key people
 Allen Paulson (CEO, 1994-2000)
Lee Iacocca (director)
Dan Lee (CEO, 2014-present)
Revenue $144.7 million (2013)[1]
$3.0 million (2013)
$-4.0 million (2013)
Number of employees
 1,116 full-time, 280 part-time[1]
Website fullhouseresorts.com

Full House Resorts, Inc. is a casino developer and operator based in Spring Valley, Nevada, in the Las Vegas Valley. It is known for the involvement of Gulfstream Aerospace founder Allen Paulson, who was CEO from 1994 to 2000, and former Chrysler chairman Lee Iacocca, who has been a major investor in the company since 1995. Dan Lee has served as CEO since 2014.[2]

History

Early days

Hour Corp. was formed in 1987, and then renamed to D.H.Z. Capital Corp.[3]

In 1992, the company changed its name to Full House after buying the Deadwood Gulch Resort, a hotel and casino in Deadwood, South Dakota.[3] The resort was expanded in 1994 with an RV park and a family fun center, Gulches of Fun.[3] By 1996, the company determined that Deadwood's remote location and low betting limits were too limiting, so it put the resort on the market,[3] selling it to a group of South Dakota businessmen[4] in 1998 for $6 million.[5]

Full House made its initial public offering on the NASDAQ Small Cap Market in 1993, raising $8 million.[3]

Allen Paulson, founder of Gulfstream Aerospace and thoroughbred racehorse breeder, bought a 17.5 percent stake in the company in March 1994, and was named chairman and CEO in August.[6]

The Coquille Indian Tribe chose Full House in 1994 from fifteen potential investors to develop a casino in North Bend, Oregon.[7] Built in a former plywood mill, The Mill opened in May 1995. The company financed the construction in exchange for 26 percent of the profits[8] through 2002.[9]

Entry of Lee Iacocca

In an effort to extend its base beyond the gaming industry, Full House was negotiating to purchase 21 acres of land in Branson, Missouri from a company owned by former Chrysler chairman Lee Iacocca, and Omega Properties, owned by John Fugazy and Full House director William McComas. During the talks, Full House learned that Iacocca and Omega were discussing four separate casino development projects with the Nottawaseppi Huron Band of Potawatomi, the Torres-Martinez Desert Cahuilla Indians, the Delaware State Fairgrounds, and four organized Indian tribes in Michigan.[3] To gain access to these projects, Full House bought Iacocca's company and Omega in 1995. Iacocca received a 12.2 percent stake in the company.[6]

With the four tribes in Michigan (Grand Traverse Band of Ottawa and Chippewa Indians, Lac Vieux Desert Band of Lake Superior Chippewa, Hannahville Indian Community, and Keweenaw Bay Indian Community),[10] Full House proposed to build a $175 million casino in a vacated department store in Detroit.[11] However, Governor John Engler decided in 1995 not to allow off-reservation Indian casinos,[12] and Full House wrote the project off.[13]

Full House worked with the Torres-Martinez tribe of southern California to lobby the federal government for more land, to replace the half of the tribe's reservation that was permanently flooded by the Salton Sea.[14] By 2001, little progress had been made with the land, or with signing a compact with the state to allow a casino, so the tribe's members voted to terminate the contract with Full House.[15] The company invoked arbitration and ultimately received a $1 million settlement from the tribe.[16]

In December 1995, the firm entered into a partnership with lottery equipment manufacturer Gtech, under which all of Full House's existing and future projects, except for Deadwood Gulch, would be pursued as joint ventures.[3] The alliance lasted until April 2001, when Full House bought out Gtech's interests for $1.8 million.[17]

In May 1996, the Delaware project came to fruition with the opening of Midway Slots & Simulcast, a casino with 500 video lottery terminals and a racebook, at Harrington Raceway at the state fairgrounds in Harrington.[18] Full House developed the casino at a cost of $11 million, and received a 15-year contract to operate it for a percentage of revenues.[18] The firm's involvement ended when the agreement expired in 2011.[19]

The proposed Nottawaseppi Huron casino in Battle Creek, Michigan was delayed by years of litigation by anti-gaming activists.[20] The $375 million FireKeepers Casino finally opened in 2009, as a joint venture with real estate developer Robert Mathewson.[21] Full House and Mathewson were to manage the casino for seven years, receiving 26% of net income,[21] but the Nottawaseppi Huron bought out the agreement four years early for $97.5 million, taking over management in 2012.[22]

Gregg Giuffria and Hard Rock Biloxi

Former rock musician Gregg Giuffria, who had befriended Iacocca and McComas through his involvement in the slot machine industry, came to them along with casino architect Paul Steelman with a proposal to build a Hard Rock hotel and casino in Biloxi, Mississippi. After reaching an agreement with the Rank Group, owner of the Hard Rock trademark, Iacocca joined the Full House board of directors, and Giuffria was named president of the company in 1998.[5] The project was organized as a joint venture between Full House and Paulson, with Paulson providing the former Treasure Bay casino boat. A seven-acre site next to the Beau Rivage casino was secured for the $250 to 300 million development.[23] Giuffria resigned from Full House in 2000, but the company pressed on with the Hard Rock.[24] By 2002, though, financing had not been found, the options to purchase the land had lapsed, and Full House dropped the project.[25] The Hard Rock Biloxi was ultimately opened in 2007 by Premier Entertainment, co-owned by Giuffria.[26]

At Giuffria's urging, the company moved its headquarters from Del Mar, California[5] to Las Vegas in 1998.[27]

Post-Allen Paulson

After Paulson's death in 2000, Full House put itself up for sale.[28] In July 2003, the Morongo Band of Mission Indians in California agreed to acquire the company for $20.1 million,[27] but a tribal ballot to approve the purchase failed later that year, and the deal was canceled.[29] Instead, Paulson's son, Michael, took over as chairman, and the company began a strategy of expansion.[28]

In 2005, Full House reached development agreements with two tribes in New Mexico. The Manuelito Chapter of the Navajo Nation selected the company from eleven applicants to develop and manage a 50,000-square-foot (4,600 m2) casino, four miles west of Gallup.[30] With the Nambé Pueblo of New Mexico, the company would develop a casino and hotel on tribal land fifteen miles north of Santa Fe, in exchange for thirty percent of net revenues for the first seven years.[31] The Navajo project was dropped in 2007, when the tribe decided to proceed without a gaming developer.[32] Market conditions, including the opening of a large casino by the nearby Pueblo of Pojoaque, led the Nambé to drop their arrangement in 2008, instead pursuing plans for a smaller travel center with a slots parlor.[33]

Also in 2005, the company entered an agreement with the Northern Cheyenne Nation to develop a $10 to 15 million casino in Lame Deer, Montana.[34] By 2010, financing difficulties forced Full House to write off the $728,000 it had spent, though it said it would continue to pursue the project.[35]

In February 2007, the company bought Stockman's Casino, an 8,400-square-foot (780 m2) casino in Fallon, Nevada, along with its 98-room Holiday Inn Express hotel, from James Peters for $25.5 million.[36] It sold the Holiday Inn a year later for $7.2 million,[37] deciding it was not important for driving customers to the casino.[38]

In 2011, Full House entered into a three-year management agreement with the Pueblo of Pojoaque to oversee its Buffalo Thunder and Cities of Gold casinos,[39] for $100,000 a month plus success fees based on financial targets.[40] The company earned $5.4 million under the contract before it expired in September 2014, and the tribe resumed self-management of the casinos.[41]

Also in 2011, the company purchased two casinos from HGMI Gaming, a Hyatt affiliate owned by the Pritzker family. It bought the assets of the Grand Lodge Casino at the Hyatt Regency hotel in Incline Village, Nevada for $700,000, and leased the space for $125,000 a month for an initial five-year term, keeping all profits.[42] It also bought the Grand Victoria riverboat casino and hotel in Rising Sun, Indiana for $43 million, and renamed it as the Rising Star Casino Resort.[43]

In October 2012, Full House acquired the Silver Slipper Casino in Lakeshore, Mississippi for $70 million, with plans to potentially add a hotel.[44] An analyst stated the company would likely continue acquiring properties with earnings in the $10−15 million range.

The company partnered in 2013 with the Keeneland Association in a plan to buy Thunder Ridge Raceway, a harness racing track in Prestonburg, Kentucky. The partners proposed to move the racing license to a new Quarter Horse track to be built in Corbin. The purchase was contingent on the formal legalization of slot machine-like Instant Racing devices, at least 300 of which would operate at the new track.[45][46]

In March 2014, Full House agreed to acquire the Fitz Casino in Tunica Resorts, Mississippi from Majestic Star Casino for $62 million.[47] Two months later, however, Full House said it would back out of the deal, citing financing difficulties.[48]

Dan Lee appointed CEO

In October 2014, a group of activist shareholders, led by former CEO of Pinnacle Entertainment Dan Lee, launched a proxy fight, accusing Full House's management of going on a "reckless buying binge".[49] Lee soon drew the support of the Paulson family.[50] The company responded by putting itself up for sale.[51] The fight ended in a settlement in December 2014, with Lee appointed as CEO of Full House.[52]

During the proxy contest, Full House was sidelined from the Thunder Ridge project, after the Kentucky Racing Commission expressed concerns about Full House and Keeneland decided to pursue the purchase alone.[53][54]

In May 2016, Full House purchased Bronco Billy's casino in Cripple Creek, Colorado for $30 million.[55]

Properties

Casinos developed or operated by Full House include:

Former properties

References

  1. ↑ 1.0 1.1 Lua error in package.lua at line 80: module 'strict' not found.
  2. ↑ http://www.businesswire.com/news/home/20141201005226/en/Full-House-Resorts-Announces-Appointment-Daniel-R.#.VOHkIPmsW6M
  3. ↑ 3.0 3.1 3.2 3.3 3.4 3.5 3.6 Lua error in package.lua at line 80: module 'strict' not found.
  4. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  5. ↑ 5.0 5.1 5.2 Lua error in package.lua at line 80: module 'strict' not found.
  6. ↑ 6.0 6.1 Lua error in package.lua at line 80: module 'strict' not found.
  7. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  8. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  9. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  10. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  11. ↑ Lua error in package.lua at line 80: module 'strict' not found.
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  13. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  14. ↑ Lua error in package.lua at line 80: module 'strict' not found.
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  16. ↑ Lua error in package.lua at line 80: module 'strict' not found.
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  18. ↑ 18.0 18.1 Lua error in package.lua at line 80: module 'strict' not found.
  19. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  20. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  21. ↑ 21.0 21.1 Lua error in package.lua at line 80: module 'strict' not found.
  22. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  23. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  24. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  25. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  26. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  27. ↑ 27.0 27.1 Lua error in package.lua at line 80: module 'strict' not found.
  28. ↑ 28.0 28.1 Lua error in package.lua at line 80: module 'strict' not found.
  29. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  30. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  31. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  32. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  33. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  34. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  35. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  36. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  37. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  38. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  39. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  40. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  41. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  42. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  43. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  44. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  45. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  46. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  47. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  48. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  49. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  50. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  51. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  52. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  53. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  54. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  55. ↑ Lua error in package.lua at line 80: module 'strict' not found.

External links

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