Dover Downs Gaming & Entertainment is betting on being the first stop for gamblers in the First State. The company operates three facilities, all in Dover, Delaware, adjacent to Dover Motorsports' Dover Downs International Speedway. Dover Downs Casino, a 165,000 square-foot facility, has more than 2,700 video slot machines; Dover Downs Hotel and Conference Center is a 500-room luxury hotel featuring ballroom, concert hall, banquet, dining, meeting room, and spa facilities; and Dover Downs Raceway features harness racing and simulcast horse race betting. Dover Downs' video slot operations are operated and administered by the Delaware State Lottery Office. Dover Downs was spun off from Dover Motorsports in 2002.
Dover Downs Gaming has struggled lately; in 2010 its earnings dropped as a result of lower slots revenue, as well as higher gaming taxes and license fees. In addition, the company experienced increased competition from regional casinos, including properties owned by Penn National Gaming and MTR Gaming. The company draws patrons from several major metropolitan areas, all of which are within a two hour drive, including Philadelphia, Baltimore, and Washington, D.C.
Another major reason for the decline in profits was the increased cost associated with opening its new table game operations. In 2010 Dover Downs introduced table games -- consisting of about 40 tables of blackjack, craps, and roulette -- to its casino. Later that year it opened The Crown Royal poker room with 12 poker tables, and subsequently expanded the operation to 18 tables. Before these additions Dover Downs exclusively offered slots, but was able to expand after the Delaware legislature authorized table games at its own lottery facilities. The company is now focused on revenue growth from its table games.
Also in 2010 Dover Downs wanted to acquire Dover Motorsports in an all-stock deal worth some $63 million. However, plans for that combination fell through later that year due to shareholder opposition to the deal. Reason for the displeasure was partly due to the low price, which valued Dover Motorsports at less than $2 per share.
The estate of John Rollins (the late chairman of Dover Downs Entertainment) owns about 30% of the company through a trust. Chairman and trustee Henry Tippie controls more than half of the firm's voting power.
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