Macau's Casino Operators Get New Licenses; Genting Loses Out




  • In Business
  • 2022-11-26 05:28:44Z
  • By Bloomberg
 

(Bloomberg) -- Macau's six casino operators won new licenses to continue running their businesses in the city, as a firm linked to Genting Group failed in its attempt to gain entry to the major gaming hub.

Most Read from Bloomberg

  • Tiantian Kullander, Co-Founder of Crypto Firm Amber, Dies at 30

  • Adobe Sees Up to $9.2 Billion in E-Commerce: Black Friday Update

  • A Rival's Misstep Helped Anwar Finally Land Malaysia's Top Job

  • US Bans Huawei, ZTE Telecom Equipment on Data-Security Risk

  • US Shoppers Kick Off Holiday Season With a Muted Black Friday

The committee in charge of the bidding of new licenses said at a press conference on Saturday the government will discuss contract details with the winners later and settle on official agreements before the end of the year. The new licenses, expected to take effect at the beginning of next year, are allowed to carry a maximum term of 10 years, according to Macau's gaming law.

The operators are Galaxy Entertainment Group Ltd., MGM China Holdings Ltd., Sands China Ltd., Wynn Macau Ltd., Melco Resorts & Entertainment Ltd. and SJM Holdings Ltd. Their competitor GMM Ltd., a company controlled by Malaysian casino tycoon and Genting Chairman Lim Kok Thay, was not selected for a new license.

The announcement concludes a sweeping change to Macau's gambling industry that started in September last year, when authorities proposed new gaming regulations to strengthen government control over casino operations and crack down on junkets' role in soliciting high-rolling bettors from mainland China, where gambling remains illegal. The law was passed in June and the bidding process for new gaming licenses started at the same time, with existing ones due to expire by the end of the year.

The decision to retain all existing operators eliminated a major uncertainty facing an industry hit by the double whammy of Covid-induced tourism drought and China's crackdown on high rollers to curb capital outflow. By reshaping Macau's gaming landscape, Beijing is pushing the enclave to reduce its reliance on gambling -- which contributes 80% of the local government's income -- and diversify into other sectors such as tourism, conferences, Chinese medicine and finance.

The license holders must prioritize the safeguarding of local employment, the development of the overseas tourism market and investment in non-gaming businesses, Secretary for Administration and Justice Cheong Weng Chon said at the press conference.

"The operation and development of our gaming industry has come to a certain scale today, but there are also some problems," Cheong said. "For example, the source of our tourists is too concentrated. It's not healthy."

Macau relies on mainland China for the bulk of its visitors, and its tourism has been severely battered during the Covid-19 pandemic as Beijing's zero tolerance to the virus means repeated lockdowns and visa restrictions that keep people from traveling. In July, when the enclave faced its biggest outbreak, the city shut down for two weeks, leaving casinos with almost zero income.

Gaming revenue in the city has plunged since March and fell to record low of $49 million in July, a 98% decline from the pre-Covid levels in 2019.

While the final contracts will stipulate how much operators need to invest in developing the overseas market and non-gaming sectors, as well as specific projects, in a force majeure, some of the contract terms and conditions could be temporarily waived, Cheong said.

Melco Chairman Lawrence Ho said the company is committed to Macau and its development as Asia's premier tourist destination, according to a statement on Saturday.

SJM said in a separate statement that it's confident in Macau's long-term growth prospects and is committed to the sustainable development of the local economy.

(Updates with details throughout)

Most Read from Bloomberg Businessweek

  • Apple's Reliance on China Grows Perilous With Chaos in iPhone City

  • Elon Musk Keeps Quoting Elon Musk About His Genius

  • The Robot Tractors Are Coming, Just as Soon as We Crush a Few Bugs

  • Professor Behind Effective Altruism on What SBF's Fall Means

  • Crypto's Crash Is Helping a Few Couples Rekindle Their Relationships

©2022 Bloomberg L.P.

COMMENTS

More Related News

Ukraine Latest: US Ambassador Vows to Isolate Russia at the UN
Ukraine Latest: US Ambassador Vows to Isolate Russia at the UN
  • World
  • 2023-02-01 18:19:45Z

(Bloomberg) -- US Ambassador to the United Nations Linda Thomas-Greenfield said the Biden administration and its allies are working to isolate Russia at the ...

India Plans $4.3 Billion Spending for Energy Transition
India Plans $4.3 Billion Spending for Energy Transition

(Bloomberg) -- India earmarked 350 billion rupees ($4.3 billion) to invest in the nation's energy security and green transition, in a step toward Prime...

Snap Forecasts First Quarterly Revenue Decline; Shares Fall
Snap Forecasts First Quarterly Revenue Decline; Shares Fall

(Bloomberg) -- Snap Inc. is forecasting its first ever quarterly revenue decline, citing a flurry of changes to Snapchat's advertising products that may be...

India Budget Seeks to Boost Capital Spending to Aid Growth
India Budget Seeks to Boost Capital Spending to Aid Growth

(Bloomberg) -- India's government proposed boosting capital spending by more than a third to 10 trillion rupees ($122.3 billion) next fiscal year to pay for ...

Macau casino revenues surge in Jan after COVID rules lifted
Macau casino revenues surge in Jan after COVID rules lifted

Macau posted an 82.5% year-on-year rise in gambling revenue to 11.6 billion patacas ($1.4 billion) in January, after the world's biggest gambling hub had...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply

Comments

Top News: Business