MGM Borgata Purchase Makes It an Online Gambling Player

Sun, Jun 12, 2016

MGM’s recently announced purchase of Boyd Gaming’s stake in Atlantic City’s Borgata casino—which now gives MGM full control of the property—gives the company control of what has been the leading online gambling sites in New Jersey. That has many analysts speculating that the company may become a major player in the push to expand the legalization of online gambling in the U.S.

When MGM Resorts solidified its ownership of Atlantic City’s Borgata casino by buying out partner Boyd Gaming, it also took over the leading online gambling sites in New Jersey.

And that has many online gambling analysts wondering if MGM will begin to take a greater role in expanding online gambling in the U.S.

In April, Borgata and its partner for online poker, PartyPoker, generated nearly $4 million in revenue ($3.2 million from online casino games, and $750,000 from online poker) and still held a lead in the market over Resorts Atlantic City and its partner PokerStars. Since December 2013, Borgata has generated about $110 million in online revenue.

The New Jersey market has been dominated by online casino games rather than online poker.

A report in PokerFuse speculates that MGM may already be looking to expand its online footprint. One example is in New York, where MGM does not have a casino presence, but has weighed in on efforts to legalize online gambling there and its recent passage by a state Senate committee of an online gambling bill.

“This legislation recognizes that millions of New Yorkers play online poker on unregulated and unprotected off-shore poker websites that operate with no oversight, fraud controls, or age restrictions,” MGM General Counsel John McManus said according to the report.

“We applaud the Senate Finance Committee’s vote to create a safe, legal environment for online poker through legislation that will generate tens of millions of dollars in revenue for taxpayers, and create open and fair opportunities for all providers of online poker,” McManus continued.

MGM also does have casino interests in two states—Michigan and Illinois—where online gambling lobbying and support has grown in the past year.

The company also has interests in Nevada where online poker is already legal, and could look to launch an online platform there. That would put it in position to lobby for New Jersey to join the online player sharing agreement already in place between Nevada and Delaware. Those agreements could also be expanded to other states.

While all speculative, analysts argue that taking full control of the New Jersey sites would be a good start for a company looking to expand its online gaming interests.

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