The Nevada Gaming Commission has approved Apollo Global Management Inc.’s acquisition of The Venetian, Palazzo and The Venetian Expo from Las Vegas Sands Corp. Potential concerns including Apollo's negative experience with Caesars in the past were overcome, and now closing to the deal could come as early as next week.
The regulator greenlighted the deal 4-0 in a meeting held on Thursday after commissioners spent more than two hours questioning Apollo officials on the transaction, reports Las Vegas Review-Journal.
Questions mostly focused on any future role Leon Black, Apollo founder and former CEO, could have with the company. Black resigned as chief executive nearly a year ago after it was disclosed he had associations with convicted sex offender Jeffrey Epstein.
Despite Black still holding an 11.9% interest in the investment management firm, officials for Apollo argued he has no controlling interest in the company. Commissioners ultimately concurred that his association with the business would not present a problem.
Still, regulators for the state added a condition to their approval granting the Commission and the Nevada Gaming Control Board the option to call Black forward for questioning should he attempt to nominate himself to the firm’s board of directors. However, Apollo officials indicated this would be an unlikely scenario, and that Black had no intention to return to leadership.
Another issue brought up during the meeting was Apollo’s past experiences within the sector, in particular the company’s acquisition of Caesars Entertainment Corp. in 2008. Carried out amid the Great Recession of the late 2000s, the 11-year ownership ended in 2019, two years after completion of a Chapter 11 bankruptcy restructuring.
Apollo’s exit from the market cleared the way for Caesars to change its ownership structure, and wiped $16 billion of the company’s pre-bankruptcy $25.6 billion in debt off the books. The troubled commercial experience, which David Sambur, co-head of private equity for Apollo, had described as having never stood a chance to succeed, was also a source of discussion in a prior meeting with the Nevada Gaming Control Board.
However, in their meeting Thursday, commissioners said they were not concerned about the experience with Caesars, similarly to what the Control Board concluded earlier this month. The transaction with Sands is seen as taking place in a different context, and thus the bankruptcy precedent does not interfere with it.
The deal with Sands was first announced in March last year, when it was revealed Apollo would be paying $2.25 billion for Venetian’s operating company and Vici would be buying the land and real estate assets for $4 billion. The transaction was expected to allow Sands to focus on its Asian operations, with Macau and Singapore at the center of the company’s attention.
The deal could close as early as next week, officials for Apollo said, according to Review-Journal. Venetian President and COO George Markantonis is set to become the CEO of the new Apollo subsidiary operating the property.
Under their management, Apollo officials said there will be a focus on diversity, with the investment firm anticipating that five of the board members of The Venetian will be women and “several of them” will be racial and ethnic minorities.