Local 54, the Atlantic City casino workers union which is arguably the largest casino union in the United States have recently met with gaming regulators in several states within the week to discuss some of the union’s concerns with regards to hedge funds and private equity groups – both of these entities have been over the recent past been amassing considerable ownership positions in the casino industry. In essence, the main complaint that Local 54 has posted is that these investors have been trying as hard as they can to tap almost every last penny from the region’s gambling sector.
With over 35 percent of Atlantic City’s casino workers being members, Local 54 boasts of over 10,000 members and this means that it represents quite a significant portion of the total casino industry workforce in the region. As such, using the union’s power and influence to address the issue of the rather greedy investors is certainly one of the best ways that casino workers in the city would have gone about that particular issue.
What the Union Really Wants
Local 54 is calling on the state’s casino control commission to intervene in a matter that is seemingly threatening the New Jersey casino sector and the jobs that it creates. As mentioned earlier, the union’s main concern is that some of the Wall Street investors in the region’s casino industry have been going about the endeavor of profit making in a manner that presents a ton of distasteful repercussions in the medium to long term.
Case in point, over the past few months or so, a number of New York-based hedge-funds have been buying significant quantities of shares from companies that operate resort casinos in Atlantic City with the main targets of these initiatives being MGM Resorts International and the renowned Caesars Entertainment which is up for sale.
“If their only interest is to squeeze money out of the company and it’s going to hurt the industry here, then I think the commission is uniquely positioned to have a say in it,” Bob McDevitt, the president of the Unite Here chapter in Atlantic City, commented in statement that was directed to the New Jersey Casino Control Commission (CCC).
During the May 8 meeting when the union brought the issue to the state’s gaming regulator, it became clear that an intervention of some sort was necessary. The primary targets of the proposed regulation changes are Caesars Entertainment which has been put up for sale by Carl Icahn, its current biggest shareholder. Also on the spotlight are the host of notable hedge funds that are buying stakes in MGM Resorts International. The union wants the state regulators to deny gaming licenses to these types of investors because they are out to “pull money out of people’s pockets in Atlantic City just because they are in a minority position of owning a casino.” In response to these demands, the state’s casino control commission has promised to do due diligence in on all the license applications that it receives.