Inside Asian Gaming

43 42 Regional Briefs Possible Skycity Sale Skycity Entertainment, the New Zealand-based owners of the SKYC- ITY Adelaide casino, said it will be forced to sell the property if group profits continue to lag. The company claims it is still committed to the SKYCITY Adelaide, andwill continue construction of amultistory parking redevelopment at the property. However, revenues at the facility are expected to be off due to the construction and a recently enacted smoking ban. The Adelaide facility is the Skycity’s only casino outside of New Zealand. Publishing & Broadcasting Limited is considered a likely can- didate to purchase the casino if it is put on the block, but private eq- uity groups may also be interested in what could prove to be a solid income source in the future. Playboy Hops to Macau After opening a Playboy Mansion club at the Palms Resort in Las Ve- gas in October 2006,Playboy Enterprises Inc now plans to open a club in Macau by late 2009. The 40,000-sq. ft Playboy Mansion Macau will feature a pool and grotto, restaurants, several dozen gaming tables and a villa-style ho- tel, drawing its inspiration from the original Playboy Mansion in the US, known worldwide for its glamorous parties, Playboy Enterprises Chief Executive Christie Hefner explained. She said the Macau man- sion will take up twice the space of the new Las Vegas club. Playboy,which sells clothing at 620 outlets in China and runs bou- tiques in Bangkok and Tokyo, hopes to capitalize on the brand’s ap- peal in Asia and the rosy prospects of Macau’s gaming market. “Asia ... is a very important region for us,”Christie Hefner said. She said Playboy, which reported a loss in 2005 and earned profit of only US$2.3 million in 2006, sold US$800 million in retail consumer prod- ucts last year, with 40% coming from Asia. Hefner,who declined to say howmuch the newmansion will cost, said gambling fits with Playboy’s core adult entertainment business. “Well-regulated gaming, whether it’s in Las Vegas or Macau, is a natu- ral adjunct of the Playboy lifestyle,” she said. Hefner also dismissed worries that Playboy’s presence in Macau will feed into the seedy image of a city also known for its shady night- life and prostitution.“Whatever negative connotations that may have existed in the past around Macau have long been supplanted by this rebirth,”she said, noting the presence of Wynn Macau and upcoming Venetian in the market. Playboy tried but failed to build a club in Shanghai.Plans fell apart in 2004 ostensibly over a disagreement between investors and local officials over how to value the amount of the investment, but some questioned whether the proposed club offended the Chinese gov- ernment’s conservative line on public morality.While Playboy can sell men’s wear in China, its magazine is banned. Playboy Mansion Macau will be part of the planned $2 billion Ma- cao Studio City, a 3.7 million sq. ft complex that combines casinos, shopping malls, hotels, movie sets and TV studios. Playboy’s new Las Vegas and Macau properties mark its return to a once-successful club operation as its traditional businesses—video sales and magazines—struggle. At its height, Playboy ran 22 clubs in cities from Chicago and New York to Tokyo and Manila.The clubs had all closed by 1991, with inter- est dampened by feminism and proliferation of adult content. Tabcorp Fights to Keep Key Licenses Tabcorp is conducting talks with the New South Wales government over the exclusivity agreement held by its flagship Star City casino in Sydney. The company’s 12-year exclusivity agreement with the govern- ment is about to expire, raising the possibility that the casino could face free-market competition. The talks come at a difficult time for Tabcorp. The company has seen its profits noticeably slip in the past year, a fact that likely lead to the resignation of former CEO Matthew Slatter earlier this year. Acting Tabcorp CEO Elmer Funke Kupper has been holding meet- ings with GrahamWest, the new NSW Gaming Minister, according to The Australian newspaper.The exclusivity agreement is due to expire in September although the casino has a 99-year operating license. Tabcorp is also involved in talks with the Victorian government over renewal of licenses to operate gaming machines and sports wa- gering. It is expected that officials will push for an increase in tax re- turns from gaming machines and possibly an upfront payment. There has also been widespread speculation in the equity market that Tabcorp could be the subject of a takeover by a consortium led by Publishing & Broadcasting Limited. The Date is Set Las Vegas Sands Corp (LVS) said its Venetian Macao Resort Hotel will open August 28, making it the first property to debut on the Cotai Strip. The Cotai Strip is a master-planned development of hotel and resort properties being created by the Sheldon Adelson-run casino operator. The Venetian Macao will be the largest building in Asia at 10.5 million square feet, including 3,000 all-suite rooms, 1.2 million square feet of meeting, convention and exhibition space, an 1,800-seat Cirque du Soleil theater, a 15,000-seat arena and 1 million square feet of retail space. The Cotai Strip will have 20,000 hotel rooms, more than 3 million square feet of retail space, and more than 2 1/2 million square feet of meeting and convention facilities when completed. Las Vegas Sands will construct and own the properties on the Cotai Strip, but they will be operated by various companies, including Four Seasons, Sheraton, St. Regis and Holiday Inn. New President at Wynn Macau Wynn Resorts Ltd. announced the July 6 departure of Wynn Macau President Grant Bowie after nearly four years with the company. In a statement, the company said Ian Coughlan, current director of hotels for Wynn Worldwide, will replace Bowie.The statement didn’t explain the reasons for Bowie’s departure. Coughlin joined Wynn Resorts in January from luxury hotel op- erator Peninsula Group, where he was general manager of Peninsula Hong Kong.“We are delighted to have a man of Ian’s caliber stepping in,”Wynn Resorts Chairman Steve Wynn said in the statement, mak- ing no reference to Bowie’s departure. Bowie’s departure comes nearly a month after Wynn Resorts an- nounced it was delaying its expansion plans in Macau because of new travel restrictions imposed by the Chinese government and in- creasing competition. The company said June 7 that it will open 25,000 square feet of additional gaming space by the end of September. Wynn Macau previously planned a 123,000-square-foot expansion, but scaled that back to only add 25 table games, 200 slot machines and a res- taurant. Deutsche Bank gaming analyst Bill Lerner said the scale-back of expansion plans at Wynn Macau and Bowie’s departure are probably unrelated. The $1.2 billion Wynn Macau opened last September with 600 hotel rooms and a 110,000-square-foot casino with 256 table games and 477 slot machines. Wynn Resorts said recently it was concerned about the market impact of the US$2.4 billion Venetian Macau, opening in August, and the US$1.1 billion MGM Grand Macau, which is scheduled to open in November. Wynn said in early June that second-quarter results “sig- nificantly exceeded expectations,” although the company won’t dis- close earnings publicly until the end of July or early August. Struggle for Nepal Casinos After a pitched battle fought in Hong Kong and Nepal, Rakesh Wadh- wa has finally gained control over Nepal’s casino kingdom, vanquish- ing his American partner, a man regarded as having friends in high places. Wadhwa, a finance whiz from Delhi who operated casinos in Sri Lanka before they were closed down by the country’s government, and holds stakes in a group of floating casinos in Goa, emerged victo- rious in the battle for Nepal’s eight casinos by acquiring an 80% share of Nepal Recreation Centre (NRC), the company that owns the chain. The NRC is owned by a Hong Kong-registered company, Canno- sa, in which Wadhwa previously held a 12.5% share while his former mentor, American Richard D.Tuttle held the remainder. Nepal’s casino network, a major draw for Indian tourists, includes seven in Kathman- du and one in Pokhara. Initially, Wadhwa ran two of the casinos while his wife Shalini looked after a third with the rest being managed by Tuttle.While the Maoist insurgency hit the gaming industry hard, NRC’s woes were ag- gravated by mismanagement and siphoning off of funds. A new can of worms opened this year when it was found that Cannosa, which held 80% of NRC shares, did not exist any longer.Tut- tle had sold his shares in 1990 and subsequently, the company was de-registered by the Hong Kong authorities. Nepal’s casino industry,which employs over 9,000 people,seemed on the verge of closure with the discovery that though Cannosa no longer existed,Tuttle had been annually applying for an extension of his yearly visa as Cannosa’s resident representative in Nepal. An alarmed Wadhwa began a search in Hong Kong for the shares Tuttle sold in 1990. They were found to have been bought by a com- pany also registered in Hong Kong, Dartford, from whom Wadhwa bought back the shares and applied to have Cannosa re-registered. Mahjong Showdown The first annual World Series of Mahjong, held at the glitzy Wynn Ma- cau Resort, began on June 15 and ended in the early hours of June 18. A total of 265 mahjong players took part in the tournament, hailing from China, Hong Kong, Macau, Taiwan, Japan, the US, UK and Den- mark. The event is owned and organized by World Mahjong Limited. Founded by a team of international media and entertainment profes- sionals,World Mahjong Limited is well-versed in the management of high-profile international sporting and entertainment events. Hong Kong player Hui Chung-Lai—with more than 50 years of mahjong experience and the highest point total of 423.11—emerged this year’s champion. Tournament spokesperson Philip Chan and World Mahjong Limited CEO John Hardyment awarded Mr Hui a golden mahjong medal and check for US$500,000. Mahjong enthusiasts are now looking forward to the upcoming MWT Mahjong World Tour event to be organized by ESL, one of the leading companies involved in Asian Gaming. The tournament aims to gather the worlds top mahjong players playing or the largest total prize money offered to date. Full details of the tournament and event venue will be announced soon.

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