Rise of the Arms Dealer in the World War-Chapter 162 - 163 The Flamingo Casino Closure

Time quickly moved into March.

One day, Hardy received a report from the intelligence office. 𝗳𝚛𝗲𝕖𝚠𝚎𝚋𝗻𝗼𝕧𝗲𝐥.𝚌𝚘𝐦

"Boss, you previously asked me to monitor Mr. Sigel’s situation. There’s trouble in Las Vegas," Henry said.

"What’s the matter?"

"Yesterday, the Flamingo Hotel and Casino announced a temporary closure. It hasn’t reopened today. The casino has been losing money; in the past three months, it lost over $1.2 million. Mr. Sigel couldn’t hold on any longer and had to announce the closure."

From the day it opened, the Flamingo Hotel and Casino faced numerous issues. First, a heavy rainstorm prevented half the guests from attending the opening ceremony.

Then the power went out that night, and the central air conditioning system broke the next day, driving away the guests.

In the following days, to attract gamblers, Sigel offered various promotions like free chips, reduced commissions on winnings, hotel discounts, and meal vouchers.

These promotions did attract some gamblers, but this approach was unsustainable. The casino couldn’t make money from the gamblers, and the operating costs were very high, losing $300,000 to $400,000 each month.

After holding on for three months, Sigel couldn’t continue and announced a temporary closure. His plan was to raise more funds, complete the planned construction, and reopen, still believing that the Flamingo would eventually make a fortune.

...

"Ring ring ring~!"

The phone on the desk rang.

Hardy picked it up and answered, "This is Jon Hardy."

"Hardy, it’s Sigel. I’m back in Los Angeles." Sigel’s slightly low voice came from the phone.

"Mr. Sigel, where are you?" Hardy asked.

"I’m at Fred’s place."

Even though the Flamingo Casino had failed, Sigel still had the Austrian Mob and the nominally affiliated Bill Gang, so he wasn’t completely destitute yet.

"I’ll head over now."

Hardy drove to Fred’s house, which was quite similar to Taylor’s place. Although it was not an estate, it was still a sizable villa.

In the study, Sigel was smoking, looking slightly forlorn. From the initial passionate planning of building Las Vegas to encountering countless problems and finally ending in failure, Even Sigel, who had a strong personality felt dejected.

"So many things went wrong on the opening day. I had a premonition that we might fail, and we did. Sigh." Sigel sighed.

"It’s not all bad. At least the casino is still there. It can be reopened in the future." Hardy consoled him.

"Yes, that’s what I think too. I want to continue with my original plan and complete the construction of the Flamingo. I believe it will rise from the ashes." Sigel said it determinedly.

Hearing Sigel’s words, Hardy had a sudden premonition that this guy would probably ask to borrow money again.

"Hardy, I’ve asked many friends, but they all said they couldn’t help. I hope you can assist me." Sigel said, looking at Hardy.

"Go ahead, Mr. Sigel." Hardy replied.

"Loan me $2 million, and I’ll use all my Flamingo shares as collateral. I believe the casino will be profitable once completed, and I can repay the money soon." Sigel said.

Just as Hardy had guessed, and he was asking for $2 million.

Sigel had likely approached others first, and after being turned down, he had no choice but to use his remaining shares as collateral.

However, the Flamingo Casino had already failed once, and no one saw a bright future for it, so Sigel couldn’t get a loan.

"The three families each hold 13%, you previously bought 18% of the shares, and I still have 43% of the shares. I’m offering these 43% as collateral for a $2 million loan. What do you say, Hardy?" Sigel proposed again.

Hardy was silent for a moment.

He did have $2 million.

Recently, his businesses were making profits, and stock prices were soaring, which was one reason Sigel had approached him, knowing he could come up with the money.

As for the money for investing in film production, the film company could take out investment loans. As long as your film company was doing well, banks were willing to lend you money. Even the major film studios operated this way, and few could fund themselves entirely out of their own pockets.

But could Sigel succeed?

"Mr. Sigel, I don’t have that much money on hand right now. How about this? I’ll have Playboy magazine loan you the $2 million, and you can sign a collateral agreement with Playboy. How does that sound?" Hardy suggested.

Hardy preferred using Playboy’s funds for the loan to avoid taxes on withdrawing money from his company.

As the majority shareholder of Playboy, owning over 90% of the total shares, having Playboy invest in the casino was almost equivalent to Hardy investing personally.

Sigel smiled. "Thank you, Hardy."

"You’re welcome."

The atmosphere in the room lightened, and Sigel’s face lit up with a smile as he chatted with Hardy about Playboy magazine.

"Hardy, I must say, your idea is brilliant. I’ve seen Playboy, and the photos of the beauties are indeed captivating. The allure of partial nudity is even more irresistible than being fully naked."

"By the way, Playboy must be making a lot of money, right?" Sigel asked.

"About $1 per issue."

"How many issues are sold per month now?"

"Over 200,000 copies."

Sigel was surprised. "That’s over $2 million in profit per year. I’ve struggled with the casino, investing over $8 million, and I’m still losing money. You casually started a magazine and made more money than I did in such a short time. In just one or two years, you’ve developed this capability that few in the U.S. could match."

He realized that his relationship with Hardy had benefited him more, and without this young ally, he might not have held on until now.

"Mr. Sigel, why don’t you stay at the estate? I recently renovated it, and it’s unoccupied. You might find it comfortable." Hardy invited.

Sigel shook his head.

"No, once I get the money, I’ll head back to Las Vegas soon." Sigel replied.

"I’ll have Playboy’s accountant and lawyer handle the procedures as quickly as possible." Hardy said.

The next day, Sigel mortgaged his 43% stake in the Flamingo Casino and obtained $2 million from Playboy, then hurried back to Las Vegas.

At this point, Hardy already controlled 61% of Flamingo Casino’s shares.

Of course, Playboy’s 43% stake was only collateral. Once Sigel repaid the loan, the shares would be returned, with only interest being charged.

However, there was a clause in the agreement that if Sigel failed to repay the loan and interest within three years, the casino shares would belong to Playboy magazine.