Wednesday April 2, 08:11 PM
Harrah's, Slovenian group Hit suspend talks on park: Hit
LJUBLJANA (AFP) - Harrah's Entertainment of the United States and Slovenia's Hit Group are suspending talks on construction of a 750-million-euro (1.17-billion-dollar) entertainment park in western Slovenia, the Hit Group said in a statement Wednesday.
"The two companies concluded that they could not find a solution that would meet the interests of both," said Hit Group, which controls the largest casinos in the tiny European Union state.
It (Frankfurt: A0MLX5 - news) added that "it was not possible to define a managing structure that would fulfill the interests of the Hit Group for a balanced development of Nova Gorica as a tourist destination and granting, at the same time, (Harrah's) expected influence in the new joint company."
The statement came two-and-a-half-years after the start of negotiations between the two companies, during which the Slovenian government had agreed to important concessions in gaming legislation in order to open the way for Harrah's investment.
The government announced last summer it was ready to change the legislation on domestic gaming companies, allowing foreign investors to own up to a 49 percent stake in the company, rather than the current 20 percent, and cutting tax on profits from gaming from 38 percent to 17.5 percent.
The two companies said last year that as soon as the law had been changed they would create of a joint venture company, in which Hit would hold a 51 percent stake and Harrah's 49 percent, to build the park by 2010.
The joint venture mega-entertainment park was expected to be one of the largest of its kind in the central Europe and would include hotels with over 650 top-class rooms, a 2000-seat congress center, more than 3000 gaming machines and 120 gaming tables.
Although the Hit Group had announced the entertainment park would be built respecting the environment and the local communities, many citizens and local authorities opposed the project, fearing its core gambling sector would have a strong negative impact in the whole region.
Slovenia's Finance Ministry issued a statement late Wednesday saying it would not comment the interruption of talks but said it had prepared the legislation needed for the park's construction.
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