MGM Grand, one of the nation's top hotel/casino and entertainment companies announced yesterday it has formed an alliance with nine Detroit business, civic and community leaders in pursuit of a license to own and operate a casino in Detroit.
"The marriage of MGM Grand's experience and depth of financial resources with this distinguished group of community leaders as our investment partners will serve Detroit well," said J. Terrence Lanni, chairman and chief executive officer of MGM Grand.
MGM Grand also announced yesterday that with its pursuit of a license to own and operate a casino in Detroit, it has received a commitment to increase its credit line to $1 billion.
This ensures MGM Grand has the immediate ability to finance construction of a major complex in Detroit in addition to its development plans elsewhere, Lanni said.
The money from that credit would be used to help finance a Detroit casino and ventures in South Africa, Lanni said.
William Pickard, owner of Roseville-based automotive supplier Regal Plastics Inc., is among the nine Detroit leaders in the venture.
"Our elected officials have made it clear that they want a world-class gaming industry in this state," Pickard said. "Our partners at MGM Grand embody that world-class status, and this community is fortunate that a company with MGM Grand's financial strength and reputation for quality and integrity has set its sights on Detroit."
Lanni said the Detroit partnership will finalize project plans after requests for proposals have been issued. He said the alliance had not selected a site, but would wait to see what land city officials preferred.
"It would be premature at this time to propose specific plans for the project," Lanni said. "We are prepared to bring to the people of Detroit and to the State of Michigan an emotionally engaging facility that will attract tourists from the Midwest region, Canada, and from throughout the world."
Two local casino groups, Greektown Casino LLC and Atwater Entertainment Inc., also are vying for two of the three licenses approved under language of the November ballot initiative legalizing casino gambling in Detroit.
"I think the partnership between the private sector and the public sector is imperative," said Alex Yemenidijian, president, chief operating officer and chief financial officer of MGM Grand.
"To really have a very successful renaissance and for the government to benefit and for the people to benefit and for private industries to benefit, they have to work hand in hand or else it doesn't work."
He said the nearly four million people living in the Detroit area and the voters' approval for casinos in Detroit makes the city a prime choice.
"The willingness of the government and the people, as voted in the referendum, to embrace gaming and entertainment is something that appeals to us a lot," he said.
MGM Grand owns 100 percent of the 5,005-room MGM Grand Hotel and Casino and half interest in the 2,034-room New York-New York Hotel and Casino, across from each other on the Las Vegas Strip.
All the groups must meet standards set by Archer's staff to reach a development agreement, gain ratification of the agreement from City Council, then be investigated for background and suitability by the Michigan Gaming Control Board.
Harrah's Entertainment Inc., also has said it is interested in building a casino in Detroit. Phil Satre, president of Harrah's said last year they would wait for gaming rules to be written.
Billionaire Kirk Kerkorian, who attempted a hostile takeover of Chrysler Corp., is the majority stockholder in MGM.
Anthony Neely, spokesman for Detroit Mayor Dennis Archer, said MGM Grand and their Detroit partners "have expressed confidence in Detroit's growing appeal as a national destination for tourists.
"MGM's reputation and experience will motivate other prospective casino developers to make sure their proposals offer Detroit the very best possible products."