Just minutes ago Macau’s six concessionaires have formally been awarded new gaming licenses, with the signing of gaming contracts with the Macau government.
The six companies signed in the order in which they ranked in the recent tender process: MGM Grand Paradise, Galaxy Casino, Venetian Macau, Melco Resorts (Macau), Wynn Resorts (Macau) and SJM Resorts.
The Chief Executive of Macau, Ho Iat Seng, signed on behalf of the Macau government.
The representatives of the six concessionaires who signed the contracts were:
- For MGM: Pansy Ho, Co-Chairperson and Managing Director of MGM China and Kenneth Fong, President, Strategic and CFO of MGM China; Standing: Other representatives of MGM, the highest placed bidder in the tender process
- For Galaxy: Lui Che Woo and Francis Lui, Chairman and Vice Chairman of Galaxy Entertainment Group
- For Venetian: Dr Wilfred Wong, President and Executive Director of Sands China Limited and Dave Sun, Executive Director, Sands China
- For Melco: Lawrence Ho, Chairman and Chief Executive Officer of Melco Resorts & Entertainment and David Sisk, Chief Operating Officer, Macau Resorts for Melco Resorts & Entertainment
- For Wynn: Craig Billings, CEO of Wynn Macau; Linda Chen, Vice Chairman, COO and Executive Director of Wynn Macau; and Ian Michael Coughlan, President and Executive Director of Wynn Macau
- For SJM: Daisy Ho, Chairman and Executive Director of SJM Holdings and Angela Leong, Co-Chairman and Executive Director of SJM Holdings
The new contracts, which come into effect on 1 January 2023, require all six concessionaires to maintain issued capital of MOP$5 billion – up from MOP$200 million under the previous contracts. Each concessionaire is required to have a so-called “Managing Director” who must be a permanent resident of Macau and must hold a minimum of 15% of the share capital of the concession-holding companies, although this shareholding is not required to have voting rights nor any economic interest. This allows the “Managing Director” to hold the 15% as a nominee or under other legal arrangements which effectively see their shareholdings “in name only.”
Today’s contract signings represent the culmination of a consequential year for the gaming industry involving major changes to the Macau gaming law and an intense public re-tender process, and will do much to calm the nerves of the six Macau casino concessionaires and the investment and banking community that has so much invested in the future of Macau.
Timed to coincide with the signing, it has been announced that the total investment committed by the six companies during the tender process was MOP$118.8 billion (US$14.9 billion), of which the total investment in developing foreign source markets and non-gaming projects is MOP$108.7 billion (US$13.6 billion) and the total investment in gaming projects is MOP$10.1 billion (US$1.26 billion), less than 10% of the non-gaming investment – in line with the Macau government’s oft-stated intention to diversify Macau’s economy. The bidding documents of the six companies included development and implementation plans for the next 10-year grant period, to occur from 1 January 2023 to 31 December 2032.
Although the concession contracts are now signed, there remains one final — if technical — hurdle for the six concessionaires to clear before being allowed to operate under the new contracts. That hurdle is the issuance of formal operating permission by the Secretary of Economy and Finance, which is expected to occur in the form of a letter issued by the Secretary to each of the six concessionaires some time between now and 31 December. The letter must confirm that all conditions precedent under the contracts have been met, and give specific permission to take bets from midnight at the beginning of Sunday 1 January 2023. After that, the champagne corks can be popped!
