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International Guild of Hospitality & Restaurant Managers
Alpha Hospitality Corp. (ALHY)
29-76 Northern Boulevard, 2nd Floor
Long Island City, NY 11101
Phone: (718) 685-3014
Corporation, incorporated on March 19, 1993, is the holding company for various
subsidiaries engaged in the ownership, development and operation of gaming
facilities, including Casino Ventures, LLC, in which it holds a 93% equity
interest. The Company also has a 25% voting membership and other non-controlling
interests in Catskill Development, LLC. The Company does not have any operations
that generate revenue. Casino Ventures, LLC is dormant and Catskill Development
must first satisfy numerous senior obligations before it can make any
significant distributions to the Company.
During 2002, the Company concentrated most of its efforts on developing gaming operations in Monticello, New York, as a member in Catskill Development. As part of this effort, the Company has divested various ancillary interests and terminated certain unprofitable operations. In November 2001, the Company suspended the operation of Ella Star, a gaming vessel leased by one of its subsidiaries in Miami, Florida, and in March 2002, it sold its interests in The Bayou Caddy's Jubilee Casino, a casino project in Greenville, Mississippi.
During 2002, the Company also increased its economic interest in Catskill Development. In March 2002, the Company entered into an agreement with Watertone Holdings, LP, a member of Catskill Development, whereby Watertone Holdings, LP transferred 47.5% of its economic interest in Catskill Development's racetrack and casino businesses to the Company. In December 2002, the Company increased its ownership interest in Catskill Development in exchange for all of Bryanston Group, Inc.'s interest in Catskill Development. As a result of these transactions, the Company now owns 36.87%, 48.31% and 25% of Catskill Development's racetrack (including any future video lottery terminal operations), casino and real estate businesses, respectively.
Alpha Hospitality is seeking to obtain control over the operating businesses and development activities of Catskill Development by acquiring the interests of its remaining partners in the Monticello Raceway and other related entities. On February 4, 2003, Alpha Hospitality entered into a Letter of Intent to consolidate interests and rights in Catskill Development into the Company. The agreement provides for the Company to acquire a 48-year ground lease on the Monticello Raceway site and contiguous properties, together with all of Catskill Development's development and management rights, with respect to the site and related gaming activities.
Casino Ventures is developing a gaming facility in Mississippi centered around a casino boat, called the Jubilation Casino Vessel. The Jubilation vessel, formerly moored at Lakeshore, Mississippi, but closed due to economic reasons, was, in conjunction with the Casino Ventures undertaking, relocated to Mhoon Landing in Tunica, Mississippi, where it is being refurbished to operate as a dockside casino. Casino Ventures is also in the process of developing a land-based infrastructure to support the gaming operations by the construction of a dockside restaurant and lodging facility. In December 2002, that vessel suffered significant damage due to a severe storm.
Catskill Development owns Monticello Raceway, a harness horseracing facility located on 232 acres in Monticello, New York. Monticello Raceway offers parimutuel wagering on live harness racing throughout the year, along with year-round simulcasting from various harness and thoroughbred racetracks across the country. Monticello Raceway derives its revenue principally from wagering on live races at Monticello Raceway, fees from wagering at out-of-state locations on races run at Monticello Raceway using export simulcasting, and revenue allocations, as prescribed by law, from betting activity at New York City, Nassau and Catskill Off Track Betting facilities.
Since 1995, Catskill Development has been attempting to develop a 29-acre parcel of land at the racetrack into a full-service, resort-style casino, in conjunction with a recognized Native American nation. It is Catskill Development's intent to enter into a definitive agreement with a federally recognized Native American tribe and obtain all the requisite federal and state approvals for the 29-acre site to be deeded to the United States Government in trust for the use and benefit of the tribe and for the tribe to conduct gaming activities on the site. This site was originally planned to be used for a casino to be owned and operated by the St Regis Mohawk Tribe, and Catskill Development incurred considerable expenditures in connection with the effort. However, after extensive local, state and federal reviews had been conducted, the St. Regis Mohawk Tribe elected to pursue the development of another location in the Catskills with Park Place Entertainment Corporation. During the last two quarters of 2002, Catskill Development retained CIBC World Markets Corporation to evaluate its strategic alternatives and began negotiations with a federally recognized Native American Tribe in New York and various casino management and development entities with respect to the site and its properties generally.
The Company faces competition from native American casinos, including those operated by the Regis Mohawk Tribe and Park Place Entertainment Corporation, the Stockbridge Munsee Band of Mohegansa and Trading Cove Associates, the Oneida Nation's Turning Stone casino, the Seneca Nation, the Mashantucket Pequot Nation's Foxwoods Resorts Casino and the Mohegan Nation's Mohegan Sun Casino Resort.
The data included within the Financial section is solely for information and does not construe a recommendation and/or endorsement by IGHRM or its members to invest funds with any of the companies listed. You are strongly advised to obtain professional advice with qualified individuals or corporations for any investments of funds.
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