• Subscribe
  • Magazines
  • About
  • Contact
  • Advertise
Friday 4 July 2025
  • zh-hant 中文
  • ja 日本語
  • en English
IAG
Advertisement
  • Newsfeed
  • Mag Articles
  • Video
  • Opinion
  • Tags
  • Regional
    • Africa
    • Australia
    • Cambodia
    • China
    • CNMI
    • Europe
    • Hong Kong
    • India
    • Japan
    • Laos
    • Latin America
    • Malaysia
    • Macau
    • Nepal
    • New Zealand
    • North America
    • North Korea
    • Philippines
    • Russia
    • Singapore
    • South Korea
    • Sri Lanka
    • Thailand
    • UAE
    • Vietnam
  • Events
  • Contributors
  • SUBSCRIBE FREE
No Result
View All Result
IAG
  • Newsfeed
  • Mag Articles
  • Video
  • Opinion
  • Tags
  • Regional
    • Africa
    • Australia
    • Cambodia
    • China
    • CNMI
    • Europe
    • Hong Kong
    • India
    • Japan
    • Laos
    • Latin America
    • Malaysia
    • Macau
    • Nepal
    • New Zealand
    • North America
    • North Korea
    • Philippines
    • Russia
    • Singapore
    • South Korea
    • Sri Lanka
    • Thailand
    • UAE
    • Vietnam
  • Events
  • Contributors
  • SUBSCRIBE FREE
No Result
View All Result
IAG
No Result
View All Result

Union Gaming: MGM China Receives Cotai Land Concession Approval

Newsdesk by Newsdesk
Thu 18 Oct 2012 at 03:47
1
SHARES
29
VIEWS
Print Friendly, PDF & Email

Union Gaming Macau released the following note on Thursday, 18th October:

This evening MGM China announced that it had accepted the Macau government’s Land Concession Contract for its future Cotai development and has already paid the government its USD56mm premium. The next step in the process, before construction can begin in earnest, is for the contract to be published in the Official Gazette, which we believe is likely 5 to 6 months out (similar to the timeframe following Wynn Macau’s premium payment). This approval is also in line with government commentary that suggested two projects would be approved this year, although we believe many had discounted this possibility with respect to MGM.

Likely a 2H16 opening

In addition to the gazetting process, MGM will also need various other approvals, such as construction, design, and labor. With this in mind, we suspect that construction will likely begin in 2H13, and assuming a 36 month development timeframe would imply a 2H16 opening. As previously communicated, the project is anticipated to cost USD2.5bn, and contain up to 500 tables, 2,500 slots and 1,600 hotel rooms, in addition to various and as-of-yet undisclosed non-gaming amenities. Upon gazetting, we suspect the company will also unveil the brand name of the project, which could likely be a recognized brand that already exists within the company’s portfolio.

Thoughts on financing and valuation

The company is currently in the market and expects to enter into a credit facility of at least USD1.5bn (we suspect this will be finalized prior to year-end). Its Cotai project budget would imply cash equity needed of USD500mm to USD1.0bn, which we don’t anticipate will be an issue given that the existing Macau asset is generating in excess of 700mm in EBITDA annually (in 2013 and beyond based on our current forecasts). When using a conservative return profile, we think MGM’s Cotai project is worth more than HKD4 per share in today’s dollars, which isn’t reflected in current valuation and would represent 30% upside to today’s closing price of HKD13.66. We think for MGM Resorts International (MGM) the Cotai project could be worth between $2-3 per share in today’s dollars.

Long-term lease implies concession renewal

We would note that the 25 year lease term as per the Land Concession Contract would imply that the government has every intention of renewing MGM China’s concession agreement upon its expiration on 2020. While we believe the renewal risk has always been considered to be quite low, we think the lease agreement, which should extend to 2038, gives a good indication of where the government’s head is at with respect to concession renewal

RelatedPosts

Macau GGR down 62% year-on-year to MOP$2.48 billion in June

Morgan Stanley: Melco and MGM China most likely Macau operators to outperform 2025 EBITDA estimates

Wed 21 May 2025 at 04:57
MGM launches new responsible gaming promotion program for Macau team members

MGM launches new responsible gaming promotion program for Macau team members

Tue 6 May 2025 at 13:05
The changing face of Macau

MGM China casino revenues down 3% year-on-year in 1Q25 on lower mass floor table drop

Thu 1 May 2025 at 06:31
Life of the party

MGM China refinances debt via new US$3 billion revolving credit facility

Wed 16 Apr 2025 at 04:54
Load More
Tags: CotaiMGMMGM ChinaUnion Gaming
ShareShare
Newsdesk

Newsdesk

The IAG Newsdesk team comprises some of the most experienced journalists in the Asian gaming industry. Offering a broad range of expertise, their decades of combined know-how spans multiple countries across a variety of topics.

Current Issue

Editorial – An inconvenient truth

Editorial – An inconvenient truth

by Ben Blaschke
Fri 27 Jun 2025 at 15:21

It’s understandable that political observers, academics and members of the public in greenfield jurisdictions would express caution around the legalization...

Light & Wonder’s Siobhan Lane

Light & Wonder’s Siobhan Lane

by Ben Blaschke
Fri 27 Jun 2025 at 15:19

Siobhan Lane, Light & Wonder’s highly experienced CEO of Gaming, speaks to Inside Asian Gaming about the company’s ongoing transformation...

Honesty is the best policy

Honesty is the best policy

by Ben Blaschke
Fri 27 Jun 2025 at 14:13

The Thailand Entertainment Complex Roundtable brought industry stakeholders, politicians and supporters of the government’s Entertainment Complex Bill face to face...

Sri Lanka’s casino industry

Sri Lanka’s casino industry

by Shaun McCamley
Fri 27 Jun 2025 at 13:36

Industry veteran Shaun McCamley delves into the complex history of Sri Lanka’s casino industry at a time when the country...

Evolution Asia
Your browser does not support HTML5 video.
Aristocrat
GLI
Nustar
SABA
Mindslot
Solaire
Hann
Tecnet
NWR
Jumbo
568Win

Related Posts

Macau planning to ban all forms of advertising for gambling activities

Macau planning to ban all forms of advertising for gambling activities

by Pierce Chan
Fri 4 Jul 2025 at 15:04

The Macao SAR Government is planning to amend advertising laws and regulations, proposing a ban on all forms of advertising for gambling activities – including the display of gambling equipment in advertisements. Macau’s Economic and Technology Development Bureau stated on...

Wynn Al Marjan Island releases first renderings of uber-luxury Enclave suite and apartment offering

Wynn Al Marjan Island releases first renderings of uber-luxury Enclave suite and apartment offering

by Ben Blaschke
Fri 4 Jul 2025 at 05:59

Wynn Resorts has released first images of its elite suite and apartment offering at Wynn Al Marjan Island, to be known as Enclave and located on the uppermost levels of the UAE integrated resort. According to information published overnight, the...

The 2024 Asian Gaming Power 50

Bally’s ready to pull out of Star rescue deal if AUSTRAC issues monster fine

by Ben Blaschke
Fri 4 Jul 2025 at 05:37

US casino operator Bally’s Corp may have to withdraw from its multi-million-dollar rescue of Star Entertainment Group should the embattled Australian firm be hit with a massive fine by AML watchdog AUSTRAC. Bally’s chairman Soo Kim made the revelation –...

Grand Korea Leisure books US$11.4 million profit in 1Q25 on higher casino sales, better margins

Grand Korea Leisure reports sequential gain but year-on-year decline in casino revenue to US$25.5 million

by Newsdesk
Fri 4 Jul 2025 at 04:52

Foreigner-only casino operator Grand Korea Leisure (GKL) reported casino revenue of KRW34.8 billion (US$25.5 million) in June, representing a 13.6% increase over May although down 6.0% compared with the same month last year. The sequential increase follows a similar trend...



IAG

© 2005-2024
Inside Asian Gaming.
All rights reserved.

  • SUBSCRIBE FREE
  • NEWSFEED
  • MAG ARTICLES
  • VIDEO
  • OPINION
  • TAGS
  • REGIONAL
  • EVENTS
  • CONSULTING
  • CONTRIBUTORS
  • MAGAZINES
  • ABOUT
  • CONTACT
  • ADVERTISE

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In

Add New Playlist

No Result
View All Result
  • Subscribe
  • Newsfeed
  • Mag Articles
  • Video
  • Opinion
  • Tags
  • Regional
  • Events
  • Contributors
  • Magazines
  • Advertise
  • Contact
  • About
  • Home for G2E Asia

© 2005-2024
Inside Asian Gaming.
All rights reserved.

  • English