Inside Asian Gaming

september 2016 inside asian gaming 29 Han Chang-woo CHAIRMAN AND CEO Maruhan Group Power 1,556 last 35 Score year Claims to fame Japan’s largest pachinko operator Played a key role in the evolution of the pachinko industry The 380th richest person in the world 19 Asian Gaming POWER 50 2 0 1 6 Last year, this list noted that Kazuo Okada was putting himself at the center of his grand but troubled resort project in Manila’s Entertainment City. Our write-up speculated that perhaps Mr Okada was emulating his former partner Steve Wynn. In July, the pachinko and slots mogul rebranded the resort as Okada Manila, featuring a dancing fountain at the entrance. Sound familiar? In fact, Okada the resort will be unlike anything in the Philippines to date, promises Tiger Resorts, the division of Mr Okada’s Tokyo listed Universal Entertainment that’s building it. Due to open in November, US$2.4 billion Okada will include Southeast Asia’s largest indoor beach, under a glass dome and doubling as a nightclub, plus nearly 1,000 rooms, 50 luxury shops and a casino with more than 500 tables and 3,000 machines. “Okada Manila has the potential to compete with the entertainment and gaming giants from across the region with its best natural resources – its hospitality and warmth,” Tiger Resorts President Steve Wolstenholme, hired last year from Nevada, says. “Here, expect an effortless integration of the Japanese It’s easy to forget just how massive Japan’s pachinko industry really is. That’s understandable given this unique form of pinball- style gambling is only really played in the one country. It has also suffered its fair share of bad press in recent times thanks to venues that are often less than enticing and a shrinking customer base that has seen revenues fall almost 40% from their peak 20 years ago. Yet even accounting for the decline, the pachinko industry is worth almost almost US$200 billion a year – the biggest slice of which belongs to Han Chang-woo’s Maruhan Group. With 315 pachinko parlors across Japan – up from 308 last year – Maruhan Group accounts for more than 10% of the nation’s pachinko market with an army of 12,482 employees as of March 2016. Mr Han’s personal fortune sits around the US$4 billion mark thanks to a combination of foresight and good timing, making him the sixth richest person in Japan and 380th in the world. Having incorporated Maruhan in 1957, the now 85-year-old rode the nation’s pachinko wave through the 1960s and has survived the pachinko slump by re-inventing his company’s parlors to provide more diverse and attractive facilities. That he is Korean-born has helped give Maruhan Group credibility, given past indiscretions by locals involved in the industry, and with a range of other projects currently in the works – including the long- awaited US$2 billion Dream Island project on Korea’s Yeongjong Island – it is clear Mr Han has no intention of riding quietly off into the sunset. Omotenashi – people’s respectful demeanor, passion for creativity and hunger for innovation – and the Filpinos’ hard work, hospitality and cheerful spirit.” Tiger Chief Operating Officer Takahiro Usui, a trusted lieutenant from Mr Okada’s Aruze gaming machine division brought aboard this year, says that with subsequent phases, total investment on the 44 hectare (109 acre) bayfront site could reach US$4 billion. Success in Manila will give Mr Okada credibility for a license in Japan in the event of casino legalization. The road to Okada’s opening has included accusations of bribery and violating Philippine land ownership laws, forfeiting a PHP100 million (US$2.2 million) performance bond for missing the completion deadline (moved to the end of this year) plus Mr Okada’s ousting from the Wynn corporate boards and cut-price redemption of his shares over issues rooted in his quest for a Philippine casino. The Wynn matter remains in litigation, with at least US$800 million at stake. However, simply opening the Manila resort in a buoyant gaming market will represent a victory for Mr Okada.