Detroit Casino Syndicators: Strather, Celani, Malik & Ilitch

Herb Strather, Tom Celani, Michael Malik & Marian Ilitch were among those who pushed for commercial gambling in Detroit in the mid 1990s.  They were also chief backers of Detroit’s MotorCity Casino.  However, in 1999 Malik and Strather failed to receive gaming licenses from the Michigan Gaming Control Board and were among those forced to divest themselves of any interest in MotorCity Casino before the gambling hall opened its doors to the public.

Herb Strather

Strather
Strather’s original Detroit-based Atwater casino syndication moved on to form AtMashpee LLC and push the Recognition and Cape Cod casino development plans of the Mashpee Wampanoag tribe. Another Strather affiliate Maushop LLC purchased 28 acres of land on Cape Cod. Strather would later reveal that South African casino moguls Sol Kerzner and Len Wolman were the primary investors in the Mashpee venture. And in 2008, further controversy ensued when Mashpee tribal chairman Glenn Marshall admitted to federal investigators that Strather had funneled $4 million to him which was used in an illegal political contributions scheme and to pay personal bills.

In 2005, Ilitch bought out Celani, Mirage Resorts and others who were part of the original MotorCity Casino syndication.

Tom Celani

Celani
Celani, a one-time beer distributor, organized Luna Entertainment.  He had been a founder of Sodak Gaming, Inc. which was acquired by International Game Technology.  He subsequently was licensed for gaming in Nevada and took over management of the famed Cal-Neva Casino previously owned by Frank Sinatra and frequented by Sinatra's "Rat Pack" entertainment pals.

Among other gaming facilities, Celani has since become licensed to own/operate, the Fortune Valley Hotel and Casino (CO), Red Dolly Casino (CO), Rolling Hills Casino (CA), and the Kiowa Red River Casino (OK). Of those Detroiters behind the original MotorCity Casino syndication and relative to the breadth of his gaming involvement, Celani has been the least controversial and most successful opening or acquiring new casinos outside of Michigan. Celani Profile.

Malik/Ilitch
Despite Malik's 1999 failure to obtain a gaming license in Michigan, Malik and Ilitch have continued as business partners. They have been relentless in their pursuits to develop and manage Indian casinos in partnership with the Bay Mills Indian Community (MI), Los Coyotes Band of Indians (CA), Big Lagoon Rancheria (CA), Shinnecock Indian Nation (NY) spending millions on lobbying, political campaign contributions and legal work. 

Similar to Strather’s AtMashpee LLC group, Malik/Ilitch organized Gateway Casino Resorts to bankroll Federal Recognition of the Shinnecock Nation.  And like Strather, they believe that investment bought them the rights to develop and manage any future Shinnecock gaming facility. Currently they are banking on approval of plans to develop a Shinnecock casino and hotel at Belmont Racetrack on Long Island (NY). 

Although Malik/Ilitch gambling pursuits have been many and they have organized dozens of affiliates to bankroll Native American casino development plans in three states, Malik/Ilitch have failed to successfully open any new gambling facilities since Malik failed to earn a gaming license and they parted company with Celani.  

Further, while chasing casino development opportunities with Ilitch, Malik has been involved in numerous controversies including: a federal ponzi scheme case; defaults on both property taxes and a $1 million line of credit; and multiple violations of California political campaign contribution laws.

See also:

• Not so favorable report of casino syndicators Strather, Varner, Malik, Slavik et al
• Three-fourths of AtMashpee LLC investors were behind entity that morphed into MotorCity Casino
• Detroiters Strather, Deitch provided $4 million fund that enabled wrongdoing by ex-tribal chairman
• UPDATED: Formerly rejected MotorCity Casino backers Malik & Strather have taken similar paths to Long Island & Cape Cod
• Mike Malik's partners also had a history of tax dodging; court ordered real estate negligence claims; and 40+ foreclosures
• Detroit-based casino developer convicted of bribing a police officer among Gov. Deval Patrick's donors
• Tom Celani: a biographical feature from Crain's Detroit Business
• Michael Malik: The Latest Life & Times of a Detroit Casino Syndicator
• Scandal Continues to Plague Political and Lobbying Activities of Detroiters Bankrolling Shinnecock Casino Plans
• How Detroit casino syndicators financed the campaign that brought Las Vegas-style casino gaming to Detroit
• The Detroit Gaming Syndicators: Marian Ilitch, Michael Malik and Tom Celani
• Six dropped from Atwater Casino Group
• Three investors must sell their Detroit casino interests
• Investors have troubled histories
• More than Two Dozen Malik / Ilitch Gaming Affiliates Pursue Casino Plans in CA, MI & NY

Former Ilitch partner bids to takeover troubled Detroit Casino

3.27.09

Tom Celani makes bid for Greektown Casino

By Nancy Kaffer

Longtime Detroit casino advocate Tom Celani said he’s making a bid for the troubled Greektown Casino. Celani owns a host of business ventures including Luna Entertainment in Novi, Farmington Hills-based Motor City Harley-Davidson and Napa Valley, Calif.-based Celani Family Vineyards.

He was instrumental in financing a 1996 statewide ballot referendum that approved gaming in Michigan, according to a 2007 Crain’s profile of Celani, and once was a partner in MotorCity Casino L.L.C., selling his share to current owner Marian Ilitch in 2005.

Greektown Casino entered Chapter 11 bankruptcy in 2008, but Celani said he believes the casino can emerge profitably.

“With the right people in place, absolutely,” he said. “But you’ve got to put the right people in place. The best option would be someone like myself that lives here and has a passion for gaming.”

The Greektown offer is a joint venture between Celani and Greenwich, Conn.-based Plainfield Asset Management L.L.C., Celani said, as LPF Holdings. Celani says he is competing against other bidders in the process.

Tom Celani backs off bid to acquire 22% of Greektown Casino

3.07.08

Celani decides not to invest in Greektown Casino

By Robert Ankeny

Tom Celani, owner of MotorCity Harley Davidson and MotorCity Power Sports, has dropped plans to acquire a stake in Greektown Casino L.L.C.

Under a plan announced in January, Celani was to become president of casino operations and buy a 22 percent stake in the company from the majority owner, the Sault Ste. Marie Tribe of Chippewa Indians.

“The tribe has time sensitive issues, and we needed more time for due diligence,” said Celani, a former investor in MotorCity Casino, “so they’re exploring other possible investors. It’s a great project and we’re still interested.”

Celani’s plan to buy into Greektown was aimed at improving the casino’s management and bolstering its finances, Tom Miller, chair of the Greektown management board, said at the time.

Celani’s involvement with the casino industry goes back more than a dozen years and includes management roles with start-up Indian casinos in Michigan and other states through his companies called Luna Gaming and Luna Entertainment.

“We could not reach an agreement on terms,” said Roger Martin, a principal in Lansing-based Martin Waymire Advocacy Communications who is a spokesman for Greektown.

Ted Gatzaros, one of the founders of Greektown who sold his stake in 2000, is believed to be one of those talking about more investment. He is still owed $60 million from the casino, was recently licensed and acquired a 1 percent stake in the casi

Casino investor Celani to partner with Sault tribe

1.31.08

New investor to be president of Greektown Casino operations

By Daniel Duggan

Former MotorCity Casino investor Tom Celani announced plans to acquire a 22 percent stake in the Greektown Casino.

Upon approval by the Michigan Gaming Control Board, Celani would become president of casino operations.

“I’m excited to be involved in the operations here,” he said during a press conference. “In fact, that’s something that we negotiated. I wanted to be involved, not just sitting on the sidelines.”

The move is aimed at improving management of the casino and bolstering its financial situation, said Tom Miller, chairman of the Greektown Management Board and an elected member of the board of directors for the Sault Ste. Marie Tribe of Chippewa Indians, a majority owner of the casino.

“This is something the tribe has been seeking for a long time,” he said. “Finally, we found someone who is a perfect fit, with expertise and a history in the area.”

With Celani’s 22 percent stake, the tribe now owns 75 percent of the casino operations.

Ted Gatzaros, one of the founders of Greektown who sold his stake in 2000, recently acquired a 1 percent stake in the casino. The remaining shares are owned by Marvin Beatty.

Miller said there are no other investors expected to be involved in the near future.

Celani, 51, of Bloomfield Hills, has significant gaming experience among his many professional endeavors.

In 1995, he partnered with a Michigan tribe to develop Little River Casino Resort in Manistee. He also has developed and managed casinos in California and Oklahoma as well as commercial casinos in Nevada and Colorado.

Celani was an owner of MotorCity Casino from 2000 to 2005 before selling his stake when co-owner Mandalay Bay merged with MGM.

He also owns Farmington Hills-based MotorCity Harley-Davidson and Bloomfield Hills-based MotorCity Power Sports, and is president of Novi-based Luna Entertainment. Celani is also proprietor of TC Vineyards Inc. in Napa Valley, Calif.

A stepped-up marketing effort at the casino is on the agenda for Celani. He also wants the casino to be involved with more corporate partnerships and to be more involved with the effort to expand Cobo Center.

“I’ll get engaged with the politics because the casino needs to play a role in that,” he said.

Asked if the casino should help pay for the project, he said “I’d never close the door on that.”

“The expansion is important to all three casinos and they should be involved,” he said.

Tom Celani buys stake in Greektown, will become president of casino operations

1.31.08

Detroit businessman buys stake in Greektown Casino

Robert Snell / The Detroit News

DETROIT -- A Bloomfield Township gambling executive who helped bankroll the successful statewide ballot initiative that led to Detroit's three casinos will become a new minority investor in Greektown Casino, according to a press release from the casino.

Tom Celani, a former MotorCity Casino investor, bought a 22-percent stake in the casino, an investment one gaming analyst said would cost approximately $200 million.

The move is expected to be approved by the Michigan Gaming Control Board since Celani already has a gaming license. Celani, who also will be named president of casino operations, is expected to use his local expertise to help Greektown better compete with the other two casinos and oversee an expanded casino and new hotel opening this fall.

"If it is 22 percent, that is a big chunk and will strengthen the financial capability of the casino's owners," said Jake Miklojcik, a gaming expert and president of Lansing-based Michigan Consultants. "And it brings in some additional southeast Michigan moxie and management."

Celani's expertise could be most noticeably felt in the type of amenities offered at the casino and with enhanced advertising, he added.

Celani's involvement comes at a time when Greektown continues to trail the other two casinos in revenue and market share.

Michigan's wagering tax brought in $160 million in 2007, yet Greektown Casino's revenue trailed those of MGM Grand Detroit Casino and MotorCity Casino, according to the Michigan Gaming Control Board.

MGM Grand Detroit Casino extended its market leadership last year with revenues of $513 million compared to $480 million for MotorCity Casino. Greektown Casino's market share fell to 25.6 percent and its revenue dropped 1.1 percent to $345 million.

The city's three state-licensed casinos took in $1.335 billion in 2007 as revenue growth slowed to 2.4 percent, Michigan regulators said.

Greektown is in the midst of a massive expansion.

The casino opened a new 2,900-space parking garage in November and will unveil a 39-story, 400-room luxury hotel this fall.

Celani, 52, is head of Novi-based Luna Entertainment, and oversees a sprawling empire that includes residential and commercial ventures and casino development and management in several states.

A Luna company developed the Little River Casino Resort in Manistee and he also owns Motor City Harley-Davidson in Farmington Hills and is an investor in MJR Theaters.

You can reach Robert Snell at (313) 222-2028 or rsnell@detnews.com.

http://detnews.com/apps/pbcs.dll/article?AID=/20080131/METRO/801310500/1361

Tom Celani: a biographical feature from Crain's Detroit Business

9.24.07

A man of many titles: Tom Celani has so many interests, it's hard to keep them straight

By Robert Ankeny

Tom Celani has to make a decision when you ask him for a business card.

He's either “owner” of Farmington Hills-based MotorCity Harley-Davidson and Bloomfield Hills-based MotorCity Power Sports; or he's “president and CEO” of Novi-based Luna Entertainment; or he's “proprietor” of TC Vineyards Inc., the Celani Family Vineyards in Napa Valley.

He's also an investor in a theater chain, a land developer in Arizona and Colorado, and a casino management consultant.

Celani, 51, of West Bloomfield Township, has grown a successful family wholesale beer company into an empire of businesses.

One source estimates Celani's companies could hit close to $250 million in revenue in 2007. His two dealerships employ about 110 people and had about $50 million in revenue last year, Celani said.

Celani expects to sell about 1,100 motorcycles this year at MotorCity, the top volume Harley-Davidson dealer in the Midwest. He is currently expanding the dealership from 30,000 to 40,000 square feet.

Walls in his upstairs office are decorated with Harley posters, a huge elk head and a large portrait of his wife Vicki and three children: Vinnie, Olivia and Ben.

On the wall near his desk is a striking photo of the Celani Family Vineyards in Napa Valley.

In many ways, Celani's heart is there on the sunny slopes that remind him of Italy, or back to Detroit's east side 40 years ago.

"I guess there always was a seed there, since I was a boy and worked with my grandfather Vincenzo in his basement making wine with grapes we'd buy at Eastern Market.

"He'd make about four barrels just for his own family and friends, and a small barrel of vinegar,” Celani said.

"I began collecting wines about 20 years ago, knew a good distributor, started going to tastings, and about 1987 put a few cases away."

Today, his home wine cellar is stocked with French, Italian and U.S. wines, and includes about 5,000 bottles, he said.

In 2005 he purchased a 20-acre vineyard with house and winery in Napa Valley.

"We're about a quarter-mile down the road from (race driver) Mario Andretti and (former Kmart CEO) Joe Antonini's vineyard," Celani said.

Celani has hired winemaker Mark Herold, who has been astonishing critics with his wines from small vineyards.

Our goal said Celani, is to build "a small, boutique, high-quality winery, and make wines sought after by great restaurants."

He said his wines — labeled "Ardore," meaning passion — will hit store shelves this fall with a limited amount of Chardonnay available in October and about 300 cases of a Cabernet/Merlot blend to be distributed by General Wine & Liquor Co. starting Nov. 1.

Celani's passion for wine-making extends to custom-designed bottles and a custom label. His love for wine has also led him to wine auctions, which in one case resulted in a spot on the board of the College for Creative Studies in Detroit.

CCS President Rick Rogers said the college family got to know Celani through the wine auctions before he became a trustee in 2003.

Celani is a big donor, as well as a major bidder at CCS wine auctions, Rogers said.

"We were already friends. Knowing of his interest in the mission of the institution, and of his level of enthusiasm, we thought he would be an asset to the board and that's worked out," Rogers said.

As a businessman, Celani also has fared well from his investments in the casino industry.

In March 1999, Celani hit a $30 million jackpot when International Game Technology (NYSE: IGT) bought Sodak Gaming Inc., a South Dakota-based slot machine distribution company he had invested in.

"I bought two-thirds of the company for $2 because two partners wanted out ... and then invested $500,000 in it," Celani said.

Sodak became the exclusive slot machine distributor to North American Indian-owned casinos for IGT, the world's largest manufacturer of slot machines.

Celani owned more than 3 million shares, according to the 1998 annual proxy report of the then-publicly traded company, when IGT decided to buy Sodak and do its own distribution to tribal casinos.

He also was working with various start-up tribal casinos in Michigan and elsewhere. That led to a partnership in Detroit's MotorCity Casino.

Celani joined with Detroit entrepreneur Herb Strather and Greektown Casino L.L.C. founders Ted Gatzaros and Jim Papas to push for commercial casinos in Detroit by helping finance a statewide ballot campaign in November 1996.

"Tom was a good partner," Strather said. "We did our deal on a handshake, in July 1995, and signed paperwork a month later."

Celani had been supporting a proposal for an Indian casino complex called FoxTown to be built east of Woodward Avenue by the Bay Mills tribe and Harrah's Casinos of Las Vegas.

But then-Gov. John Engler blocked off-reservation casinos, Strather said.

"My recollections of Tom are that he always kept his word and he had guts. I'm very appreciative to have worked with him," Strather said.

Celani was a partner in MotorCity Casino L.L.C., and sold his share to Marian Ilitch when she gained total control in 2005.

Ilitch paid MGM Grand/Mirage Casinos $525 million for its Mandalay Bay holdings, a 53.5 percent share of MotorCity. She bought an additional 11.5 percent from Strather's group, Atwater Associates L.L.C., for $100 million and 10 percent from Celani for an undisclosed amount estimated at between $85 million and $100 million.

In addition to casinos, Celani is a major figure on Detroit's philanthropic scene.

In 2003, the Celanis donated $1 million worth of Harley-Davidson and Buell motorcycles, personal watercraft and other power sports items to the Central Michigan University College of Business Administration.

"Those were ingenious contributions," said Steve Smith, CMU director of media relations. "Celani's idea was that marketing students could find the best ways to sell the 'boy toys,' with the money from the sale going toward a student investment portfolio, the Tom and Vicki Celani Venture Capital Fund.

"It gave marketing students a chance to figure out how to get the best prices for those items, so the bikes were auctioned on eBay," he said.

Then finance students got to figure out how to invest the money in the stock market. "It gave them real world experience," Smith said.

Celani attended CMU as a freshman in 1974 but left to help run the family business — Action, a Livonia-based Miller beer distributorship — because his mother was dying.

In 2004, CMU awarded Celani an honorary doctorate for his "more than three decades as a business leader and entrepreneur."

And in 2005, the university named a new dorm on the Mt. Pleasant campus the Ben and Marion Celani Residence Hall in memory of Celani's parents.

Since 1982, one of Celani's favorite charitable endeavors has been Hearts of Livonia, founded in 1978 by his father. The nonprofit raises money for advanced life-support equipment at Livonia's St. Mary Mercy Hospital, giving $2.6 million to St. Mary and other charities, including more than 160 college scholarships for Livonia students.

The Celanis also support Rochester-based Sweet Dreams Project, Oakland Child Abuse and Neglect Council, and the Rainbow Make-a-Wish Foundation in Oakland County. They are also benefactors to the Detroit Symphony Orchestra and Michigan Opera Theatre.

"He's such a good community citizen," said David DiChiera, founder and general director of MOT. "You don't meet many people as open to supporting community efforts as he and Vicki."

He said the Celanis opened their home for a fund-raiser for the world premier of "Cyrano," DiChiera's own opera that will be performed Oct. 13-28.

"They do it with such grace, everything very beautifully done, and show so much enjoyment doing it," DiChiera said.

Robert Ankeny: (313) 446-0404, bankeny@crain.com

Former MotorCity investor Celani opens Okla. casino

6.11.07

Local businessman Tom Celani, a former investor in MotorCity Casino L.L.C., has opened a casino in Carnegie, Okla., in conjunction with the Kiowa Tribe.

The 65,000-square-foot Kiowa Red River Casino features about 1,000 slot machines and more than 20 table games and includes three restaurants.

Red River is expected to generate $70 million in gross revenue in its first 12 months of operation, with the tribe expecting to receive net profit of $100 million in five years, Celani, of Bloomfield Hills, said in a statement. His company Luna Gaming provided financing for the casino.

Celani’s other casino interests are in Rolling Hills Casino, Corning, Calif.; Little River Casino, Manistee; Red Dolly Casino, Black Hawk, Colo.; and Cal Neva Casino, Lake Tahoe, Nev. He also owns MotorCity Harley Davidson in Farmington Hills.

— Robert Ankeny

BACKGROUND

Tom Celani, Marian Ilitch and Michael Malik collectively held 85% interest in Atwater Casino Group (ACG), a collection of Detroit area business leaders who had backed the proposal for three casinos in Detroit.

In 1997, ACG joined together with Circus Circus (later Mandalay Resort Group) to form Detroit Entertainment LLC (DELLC), the company behind MotorCity Casino (a DELLC d/b/a). Celani, Ilitch and Malik collectivelyheld a 35% stake in MotorCity Casino.

In 1999, before MotorCity Casino even opened, several of the ACG local shareholders were disqualified from receiving gaming licenses or otherwise forced to sell their shares including Herb Strather, Nellie Varner, Walter Douglas, Laurence Deitch, James Blain, Ronald Slavic and Malik. All but Malik sold their interests to Mandalay Resort Group.

Malik sold his shares to Ilitch and Celani because the Michigan Gaming Control Board wouldn't grant him a license. Ilitch retained 25% of MotorCity and Celani 10%.

Early in 2005, Ilitch opened negotiations with Mandalay Resort Group and MGM/Mirage to acquire their 53.5% interest in MotorCity Casino; Celani lead the other investors behind ACG and filed suit in February 2005 alleging Marian Ilitch had violated the terms of their partnership agreement by secretly and unilaterally negotiating a deal to purchase Mandalay's stake in the gaming hall. Several months later, the parties settled and Ilitch acquired all outstanding shares of Detroit Entertainment LLC to take 100% control of MotorCity Casino.

You may want to review these posts:

• Ex-owner of MotorCity gets Nev. casino license
• The Detroit Gaming Syndicators: Marian Ilitch, Michael Malik and Tom Celani
• Ilitch, Malik casino syndication partner to run Lake Tahoe casino once owned by Sinatra
• Strather reportedly invested $15 million in Mashpee Wampanoag casino
• Mashpee Wampanoag, Strather involved with Abramoff and associates
• Six dropped from Atwater Casino Group
• Three investors must sell their Detroit casino interests
• Investors have troubled histories

Ex-owner of MotorCity gets Nev. casino license

January 3, 2007

Ex-owner of MotorCity gets Nev. casino license
Celani led effort for Detroit gaming

BY MARGARITA BAUZA
FREE PRESS BUSINESS WRITER

Nevada gaming regulators have awarded veteran gaming figure Tom Celani -- who helped bring casinos to Detroit -- a license to run the Cal-Neva casino on Lake Tahoe's North Shore.

Frank Sinatra briefly owned the casino, once a fabled playground for Hollywood stars.

Celani, a former owner of the MotorCity Casino, takes over the resort today and will invest $35 million in renovations to the casino, its hotel and spa. He was awarded the license Dec. 21.

Dennis K. Neilander, chairman of the Nevada Gaming Control Board, said Luna Gaming Tahoe LLC, Celani's company, plans to lease the casino from the property's owner, Namwest LLC.

Neilander and Celani declined to disclose the lease amount.

Celani of Bloomfield Hills has held more than 20 licenses at casinos around the country. This is his first license in Nevada.

Celani helped spearhead the 1996 Michigan statewide referendum that led to casino gaming in Detroit.

His group was selected as one of the three companies to receive a casino license for MotorCity Casino, which opened to the public in December 1999.

Celani sold his interest in MotorCity Casino in April 2005.

"It took us 12 months to get licensed in Nevada," Celani said. "They have a very thorough process."

Celani will work with historians to restore the casino, which has a rich history as a hangout for the famous Rat Pack, a group of entertainers from the 1950s and 1960s that include Sinatra, Dean Martin and Sammy Davis Jr.

The original Cal-Neva was built in 1926. Sinatra owned it during the early 1960s, when its guest list included Marilyn Monroe as well as Sinatra's Rat Pack pals.

"I have two historians helping me put together the history of the casino. I want to bring back the nostalgia and the pictures from the '40s and '50s," Celani said.

Construction begins in April and is expected to take 12 months.

Contact MARGARITA BAUZA at 313-222-6823 or mbauza

@freepress.com.

http://www.freep.com/apps/pbcs.dll/article?AID=2007701030309

You may also want to review these posts:

The Verifiable Truth: The Detroit Gaming Syndicators: Marian Ilitch, Michael Malik and Tom Celani