MGM, Boyd Gaming to form company with bwin.Party

MGM Resorts International and Boyd Gaming are forming a new company with European online gambling giant bwin.party to offer online poker in the United States when it is regulated by the government.

Boyd announced today that it would own 10 percent of the joint venture. MGM Resorts will own 25 percent of the joint venture and bwin.party will control the remaining 65 percent, according to multiple media reports, including Bloomberg and MarketWatch.

Bwin.party is the world's largest publicly-traded online gaming company and recorded more than $1 billion in pro forma net revenue in 2010.

Boyd is also entering a separate 15-year licensing deal to use bwin.party's software and technology to offer online poker using a Boyd brand.

"We see online poker as a compelling future growth opportunity for our company," said Kevin Smith, president and CEO of Boyd. "And this agreement would position Boyd Gaming to quickly become a leader in the online poker market in the United States."

"MGM is proud to have bwin.party as our partner as they have the assets and experience that, combined with our brands, can ensure a secure, fair and entertaining online poker experience," added Jim Murren, chairman and CEO of MGM Resorts.

Both Murren and Smith said they preferred a federal solution to regulating online poker.

"We believe that the right approach to offering legal online poker in the United States is through a federal regulatory structure that ensures the games are conducted with the greatest possible integrity and security," Smith said. "Should Congress enact legislation to legalize Internet poker, this agreement will allow us to partner with the world's most experienced and prestigious online operator to offer a secure, fair and entertaining experience for players in the United States."

"MGM has long been supportive of federal legislation to strengthen UIGEA and provide the needed regulations and consumer protections for online poker," Murren said.

The future of online poker legislation in Congress is uncertain for this year. After a recent House subcommittee hearing on online poker, Rep. Mary Bono Mack - who chaired the hearing -- indicated she thinks Congress should move slowly on the issue and wants to hold another hearing.

Online poker proponents are hoping the debt "super committee" will include a provision that licenses and regulates online poker. But with Sen. Jon Kyl -- one of the architects of the Unlawful Internet Gambling Enforcement Act -- on the committee, there are no guarantees that Congress will take action this year, or during an election year in 2012.