The advent of Internet gambling in New Jersey has left a British firm placing a bet on Atlantic City with plans to build or buy a resort casino.
London-based 2UP Gaming PLC is in negotiations to purchase an Atlantic City casino. If that?s not possible, the company is prepared to build anew, said Vincent Crandon, who will oversee 2UP Gaming?s American expansion. The company announced its intentions Friday, saying an Asian investment firm is prepared to contribute $330 million to the project.
?I don?t count New Jersey out by any means,? Crandon said, speaking about the decision to enter the Atlantic City market. ?We?re dedicated to being in Atlantic City. We?re not going to walk away.?
2UP plans to announce whether it will pursue an acquisition or new construction by Labor Day weekend, about the time an agreement between the firm and the investment group is expected to be finalized.
Crandon said the company would prefer to acquire an existing casino by September, as that would allow it to move forward with the state?s first day of legal Internet gambling in November. 2UP is in negotiations with multiple properties, but officials would not identify which casinos are in the mix.
If a sale doesn?t come together quickly, however, 2UP Gaming is prepared to build, Crandon said. The firm already has begun working on architectural renderings with Atlantic City-based SOSH Architects. Crandon would not disclose what locations are under consideration.
New Jersey Casino Control Commission Chairman Matthew Levinson said the commission has not received an application of any kind from 2UP, but an application would likely not be made until the firm decides which option it will pursue.
2UP is a publicly traded company of leisure and entertainment products based in the United Kingdom. It operates Internet gambling website?2UP.com, which offers blackjack, poker, baccarat and roulette. Financial reports list the number of employees as anywhere from four to 12.
?It?s no secret that there are some properties out there, and I?m sure they?re looking at their options,? Levinson said. ?They could build a standard casino or look at one of the two boutique licenses out there right now. There?s a lot of opportunity now in the city.?
Only casinos that operate in Atlantic City can offer Internet gambling alone or in partnership with a licensed Internet provider. All companies wishing to serve as Internet providers ? whether domestic or foreign ? must be licensed by the state Division of Gaming Enforcement.
Companies applying for the licenses must file formal applications by Monday. The DGE plans to complete necessary reviews for the planned Nov. 26 launch of Internet gambling in New Jersey, division spokeswoman Lisa Spengler said.
The names of applicants will not be made public until they are placed on an active vendor list on the division?s website, Spengler said.
Should 2UP opt to build, the firm could take advantage of 2011 legislation allowing two smaller-scale casinos to be built in Atlantic City. Legislation allows for two projects with as few as 200 hotel rooms, compared to Atlantic City?s previous minimum of 500 rooms.
Officials had hoped the legislation would encourage developers to quickly build more affordable projects. But the only applicant, Hard Rock International, abandoned plans last year, saying market conditions were not strong enough.
State Sen. Jim Whelan, who authored the legislation allowing for smaller casino projects, said he?d met with 2UP representatives but was unaware of the specifics of their plans in Atlantic City.
?I have no idea what their plans are beyond what they?ve announced,? said Whelan, D-Atlantic. ?Certainly a tool they could use to do business would be a boutique casino. That might make all the difference in the world.?
Whether 2UP decides to build or buy, its interest in the region is a sign that other companies might follow, local officials said.
Israel Posner, a casino analyst at The Richard Stockton College of New Jersey, said he wasn?t surprised by 2UP?s plans for Atlantic City, especially given the current affordability of the market.
Trump Plaza Hotel and Casino was nearly sold earlier this year to the Meruelo Group, of Downey, Calif., for $20 million ? a fraction of its $210 million building cost ? until investor Carl Icahn blocked the deal. The Rational Group proposed buying Atlantic Club Casino Hotel for $15 million in a deal that?s now tied up in litigation.
?You?re on the dawn of an entirely new industry. There will be a lot of players trying to get in,? Posner said. ?It?s almost a no-brainer. I would be surprised if you don?t see more after this.?
2UP is not the only Internet gambling company to attempt to broach the Atlantic City market this year. Online gambling giant PokerStars and its parent company, The Rational Group, are currently in litigation over the sale of Atlantic Club. While that case plays out, PokerStars has teamed up with Resorts Casino Hotel as its Internet gambling partner.