18 June 2011
James Packer Gambling On 3rd Macau Casino, by Greg Tingle - 18th June 2011
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Asia Pacific gambling news remains red hot with Crown Limited's James Packer busy in Macau with Mr Lawrence Ho aiming to build a third land based casino... Media Man and Gambling911 with the hottest Aussie and Asia Pacific gambling news available anywhere...
JP's Macau casino joint venture plans to build a massive $US2.5 billion ($2.3bn) casino resort...the group's lucky third in the Chinese territory. This will see them look capitalise on surging gaming revenues in the red hot part of the world.
Melco Crown Entertainment yesterday signed off on a $US360 million deal to gain control of the Macau Studio City project, an "integrated resort project" on hold since the global financial crisis and in planning for more than 10 years.
The firms chief executive, Lawrence Ho, advised the property's theme and demographic target focus would be differentiated from the company's existing Macau property assets, the City of Dreams and the Altira Macau.
Construction is due to start early next year and it is believed the partners have no plans for an equity issue to fund the project.
"We believe Macau Studio City's existing land grant and previously completed site work will allow us to significantly expedite its construction timetable," Ho told the press yesterday.
It will be Melco Crown's second project on Macau's Cotai strip, a vast stretch of reclaimed land situated between the islands of Taipa and Coloane that land based casino developers in Macau, such as Ho and Packer, are promoting as the orient's answer to the Las Vegas strip aka "Sin City". City of Dreams is in Cotai.
Last year, Ho said Melco Crown was prepared to build more casino resort developments in Macau and elsewhere in Asia. Packer's Crown holds a 33.4% stake in Melco Crown.
The Studio City site is one of the last prime land sites available in Macau for development.
It is located at the Lotus Bridge immigration point, making it the virgin resort that tourists encounter via entering Cotai.
Before the financial meltdown, Melco Crown had a management arrangement with Studio City's owners to run the casino at the site, but elected to take control of the project after it became troublesome for the owners to properly fund it within the prior structure.
Melco Crown is understood to have codenamed the deal Project Eagle.
The deal ends 3 long years of delays caused by legal matters and a range of dramas between the Hong Kong and US investors.
Studio City was previously owned by a joint venture between Hong Kong-listed entertainment company eSun Holdings and New Cotai Holdings, an entity controlled by funds managed by US firms Silver Point Capital and Oaktree Capital Management.
New Cotai Holdings will hold a 40% stake.
Melco Crown will pay New Cotai $US100m in 3 instalments over two years.
Before the financial crunch, the casino development was to have included a specially designed 4000-seat arena, a 2300-seat theatre, Asia's first "Playboy Mansion" and 4 new classy hotels - a Ritz-Carlton, a W Hotel, a Marriott and the world's first Tang Hotel.
Last month, Macau gaming revenues rose 42.4% to a record $US3.03bn, what Vegas casino operators dream of.
They were rocketed by the opening of Galaxy Entertainment Group's $US2bn resort development at Cotai, which is nearby to the City of Dreams.
"We remain bullish on Macau's prospects and believe high-quality new supply, such as Macau Studio City, will continue to drive incremental demand," Ho said.
Media Man has been speaking to property and gaming experts about the Packer - Macau developments, with 95% believing that the latest Packer Macau project with be a "good to great business and investment".
Friends, good punting, know your limits and bet with your head, not over it.
Punters, er readers, stay glued to Media Man and Gambling911 reports for more "can't miss" information on Asia Pacific pokies, gaming and casino wars.
*Media Man http://www.mediamanint.com is primarily a media, publicity and internet portal development company. They cover a dozen industry sectors including gaming. Media Man also publishes Media Man News
*The writer owns shares in Crown Limited
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