Mr. Chips In America

AS HE TALKS, SOL KERZNER CONstantly fingers silver worry beads, his crutch since kicking a three-pack-a-day habit a few years back. The South African entrepreneur does have worries. Kerzner, a barrel-chested former boxer, makes his debut this fall as America's next gaming mogul--and a serious East Coast rival to Donald Trump. With two big casino deals in Atlantic City and Connecticut, Kerzner is suddenly poised to tempt gamblers from their money at two ends of one of the nation's most populous corridors. But he faces huge risks as well, including fresh allegations of bribery back home that could delay or derail his investments.

Kerzner's journey to America has been a decadelong odyssey. The owner of splashy resorts in France and the Bahamas, he tried to crack the U.S. market in 1983, only to get chased out by a hail of anti-apartheid protests. But in the last few years Kerzner's Sun International Hotels has, like many other South African companies since the end of white rule, roared onto the global investment scene. In late August, Kerzner announced he was buying Merv Griffin's much-troubled Resorts Casino Hotel for some $350 million in debt and equity--and will spend hundreds of millions more on a brand-new complex. And early next month he will open the $300 million Mohegan Sun Casino on a Connecticut reservation.

The deals are fraught with risk. Atlantic City is already suffering casino overload, and Kerzner must share profits with the Mohegan tribe on a complex sliding scale. But Kerzner thinks he can add value by doing more than cashing chips. His specialty is ""themed'' casino resorts with spectacular effects, in the style of the developer he most admires, Mirage Resorts' Steve Wynn. (The Mohegan casino, for instance, will be shaped like a giant wigwam, with slots called ""cash canoes.'') Kerzner's flair and drive may be just the thing for the aging Resorts, a dull brown blotch on the spangled Atlantic City skyline and nothing less than a black hole for Griffin. The entertainer poured some $100 million into the property and has barely broken even despite the $50 million and 4 percent Sun stake he reaps from the Kerzner deal.

Now the heat is on Kerzner himself. Last week Connecticut reopened a probe into his past after a former South African official, Bantu Holomisa, claimed that Kerzner had given the African National Congress more than $500,000 to quash bribery charges from an earlier deal. Still, Connecticut gaming officials don't expect the new claim to delay the Mohegan opening on Oct. 12. New Jersey investigators also plan to scour his holdings overseas, but Casino Commission director Frank Catania told NEWSWEEK that he sees nothing now that would block a license. Kerzner insists Holomisa is talking nonsense. ""Every one of these allegations has proved to be false,'' he says. Donald Trump can only hope.