Inside Asian Gaming

INSIDE ASIAN GAMING | December 2009 Cover Story 8 2006 January – The SJM-licensed Grand Emperor Hotel & Casino opens for business. The property on Macau peninsula is the first of the ‘new build’ SJM licensed properties in the market and features real gold ingots set into the floor (safely behind armoured Perspex). It’s in part a tribute to the background of Albert Yeung, the founder and chairman of the property’s developer, Emperor Group. He started in business in Hong Kong with a single jewellery shop. The company also names Hong Kong to Hollywood crossover actor Jackie Chan as a minority shareholder in the venture. March – Galaxy’s Rio Casino opens in downtown Macau. The high roller-focused property offers four private VIP rooms as well as a mass gaming floor with 51 gaming tables and 150 slot machines. Table games options cover the Macau perennial favourite baccarat, plus blackjack, Caribbean Stud poker, roulette and the dice game sic bo. Melco-PBL announces it has struck a deal to purchase a Macau gaming sub licence from Wynn Resorts for US$900 million. Melco-PBL, the joint venture between Hong Kong listed Melco run by Dr Stanley Ho’s son Lawrence Ho and Australia’s Publishing and Broadcasting Ltd, run by the late Kerrie Packer’s son James, is later rebranded as Melco Crown Entertainment after Mr Packer sells off many of his media interests and spins off his casino holdings into a new company called Crown Ltd. Q1 2006 – Slot machine quarterly earnings in Macau break the US$50 million barrier for the first time. Slots bring in US$53 million in Q1 2006—almost twice as much as the whole of 2003. Despite the hike in slot earnings, they still account at the time for only 3.4% of Macau’s gross gaming revenues. In Las Vegas, slots average 55% of revenue on the Las Vegas Strip and 70% of revenue in the Downtown area. May – Several thousand unemployed Macau residents take to the streets protesting about the use of foreign labour and migrants from Mainland China in the city’s booming casino construction sector. Four demonstrators are arrested in scuffles with police. The police report 25 officers are injured. The timing is a source of some embarrassment for the government, given that May Day is traditionally a time celebrating workers’ rights movements around the world. June – Dr Stanley Ho’s investment holding company, STDM, announces it is postponing the planned public flotation on the Hong Kong stock exchange of its casino operating arm, SJM, until the following month. The delay comes after Dr Ho’s sister Winnie Ho, a shareholder in SJM, makes a legal challenge to plans to spin off the assets of SJM into a new holding company in order to complete the listing. Canadian entertainment company Cirque du Soleil announces it has agreed a deal with LasVegas Sands Corp to create an original stage show for The Venetian Macao, then under construction on Cotai. Hong Kong-listed eSun Holdings, a company specialising in Chinese- language film and music entertainment, announces financial partners for Macao Studio City on Cotai. Silver Point Capital, a US-based investment fund, along with former LVS executive David Friedman, are named as 40% partners in the HK$15 billion (US$1.94 billion at today’s prices) gaming and entertainment project. To date, only preparatory groundwork has been completed and analysts think the project may not now go ahead. LVSobtainsaUS$2.5billionsyndicated loan for its Cotai projects. At the time, it is described as the largest ever single credit package extended to a non-government organisation operating within China. Goldman Sachs Credit Partners act as lead provider, with five other banks, including the now-defunct Lehman Brothers, sharing the debt risk between them. July – Analysts speculate Harrah’s Entertainment Inc may be poised to take a stake in Hong Kong-listed operator Galaxy. Shares in Galaxy rise. August – Dr Stanley Ho warns the Macau media of the potential for “vicious The Grand Emperor Hotel & Casino James Packer Rio Hotel & Casino