Station Casinos’ plan to go public again has received final approval from Nevada regulators.
The initial public offering plan of the off-Strip casino-hotel chain that caters to Las Vegas locals was approved on January 21 by the Nevada Gaming Commission and the Gaming Control Board. Following successful completion of its IPO, Red Rock Resorts Inc. is the new name the company will be publicly traded under. Brothers Lorenzo Fertitta and Frank Fertitta III will maintain a significant stake, 43 percent and two of five seats on the red Rock Resorts board, in the company that went private in 2007, according to Vegas Inc.
While according to the company, Stations is on strong financial footing after having to file for bankruptcy in 2009, the Culinary Union Local 226, which for years has tried to unionize workers there, has criticized the move. The unions focus of late has been Station’s connection to Deutsche Bank, which through a subsidiary controls a stake in the company. The union’s research director, Maya Holmes, cited interest-rate manipulation by the Deutsche Bank and the subsequent $2.5 billion fine, among other concerns about the bank, during her criticism of the IPO. The issue came up again and the Station representatives assured regulators that the Bank had no undue influence on their company. Confirmation was also sought and received by board member Terry Johnson that the Deutsche Bank’s problematic subsidiary was different than the one that has had dealings with Station. The $460 million Fertitta Entertainment acquisition was also criticized by Union affiliates, who said, among other issues, the acquisition was too beneficial to company insiders. In the end however, no serious objections were made by regulators to Station’s application.
Typically, two weeks before seeking a final nod from the commission Station would have sought approval from the gaming board first. Last Thursday’s expedited version of the normal process is not the norm. It’s unclear as to when the stock will be sold, but Station President Richard Haskins indicated in order to keep the IPO process on track, the company needed to obtain both approvals at once. The Securities and Exchange Commission still needs to clear Station and in order to generate interest from possible investors, it needs to begin what’s known as a “road show.”
Twenty-one properties in the Vegas-area, Michigan and California, including Red Rock Casino, Palace Station and Green Valley Ranch resorts locally, are owned or partially owned by Station.