Station Casinos was founded by Frank Fertitta Jr in 1976 and has built a strong presence in Nevada during the last forty years. The company which is still run by the Fertitta family currently operates 19 casinos in Nevada and is in the process of going ahead with an initial public offering (IPO).
The company has enlisted the services of Deutsche Bank (DB) to help with the IPO roll out and the bank’s securities division will be responsible for the process. DB owns twenty five percent of Station Casinos via one of its subsidiaries and otherwise has a strong presence in Las Vegas. The bank has been in the news this year after investigations highlighted the fact that the German bank had violated a number of laws in determining interest rates in the interbank loan market. The authorities imposed a massive fine of $2.5 billion on the bank after it admitted to these violations.
The bank was also accused of transacting with clients belonging to companies in Syria and Iran, who are on a list of sanctions by the United States. DB once again admitted to these charges and had to pay a fine of $250 million to the Federal Reserve and New York State regulators.
Local 226, the culinary workers union has had a long feud with a number of casinos owned by Station Casinos. The union has a strong membership that exceeds 55,000 casino workers who comprise mostly of bartenders, housekeepers, cocktail servers and cooks. The union recently decided to write to the Securities and Exchange Commission and ask for the commission to review the IPO documentation filed by Station Casinos in 2013. The Union states that Station Casinos has not disclosed any of DB’s irregularities and violations which the union finds extremely disturbing.
In the letter, the Union says “We believe the S.E.C. requires a high degree of disclosure so that public investors can judge for themselves the risks associated with buying shares in an I.P.O. like Station Casinos. We ask the board to immediately start a review as to whether it is consistent with Nevada’s gaming laws for an investor with this record to have a significant ownership stake in the holder of an unrestricted gaming license”.
This is not the first time that Station Casinos has filed for an IPO. The company initially went public in 1993 but ended up going private in 2007. Station Casinos has so far not issued a statement addressing the most recent opposition raised by the union.