Some investors in Macau Legend, the holding company of Macau businessman David Chow, reportedly want to take control of its Babylon casino, reports the South China Morning Post.
The motivation is to mitigate losses arising from the underperformance of Mr Chow’s other Macau investments—in particular Fisherman’s Wharf. Mr Chow has a half share in Fisherman’s Wharf, where the Babylon casino is located.
Getting control of the Babylon will not, however, be straightforward. SJM Holdings, Dr Ho’s casino operating company, which is still majority-owned by the family, manages the Babylon and provides the gaming licence. Dr Ho also owns the other half of Fisherman’s Wharf.
The problems reportedly arise from Merrill Lynch’s sale of a USD400 million stake in Macau Legend in 2006. The investors were a score of high net worth individuals and a group of hedge funds, according to the SCMP. So far they haven’t seen any money back, according to the newspaper, and some of them are getting more than a little itchy for some liquidity from the deal.
Some investors are even willing to accept control of Fisherman’s Wharf’s real estate in mitigation of their losses. That looks like the triumph of hope over experience, when it comes to that particular white elephant.
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