MACAU BUSINESS
Land battle
SJM wants two parcels of land in Cotai that are earmarked for Sands China. Sands’ boss Sheldon Adelson is not worried
A
play by Sociedade de Jogos de Macau (SJM) to develop two parcels of land in Cotai reserved for Sands China has been waived off by Sands’ boss Sheldon
Adelson. “Wishful thinking goes on everywhere,” Mr
Adelson replied when asked about the matter at a CLSA investors’ conference in Hong Kong last month.
SJM has already made a formal approach to
the government to express its interest in parcels seven and eight but the land has been unofficially reserved for Sands China. Sands expects the government to grant it the parcels. “We hope to have a larger space for
development,” SJM’s chief executive, Ambrose So Shu Fai, told reporters. “SJM has the least exposure in Cotai, so we’ve said that if there is other land available we’ll be interested in it.”
SJM applied for two other parcels in Cotai in
2007 but is waiting for a decision from the government. Mr So said his company was hoping to get an answer this year. Sands China has said it has received no official notice of SJM’s interest and is prepared to defend its toehold on the land.
Fair shares It is not unusual in Macau for the
government to reach ad hoc agreements with developers on the use of land, and for land to be officially granted to a developer only after construction work is well under way. The development of the Venetian Macao, Grand Lisboa and City of Dreams followed this pattern.
In August, Sands China’s acting chief
executive, Mike Leven, said his company had already spent US$162 million (MOP1.3 billion)
Sands’ dollars stay here: Adelson Las Vegas Sands chairman Sheldon Adelson says his company is not
taking profits generated by subsidiary Sands China out of Macau. “We have independent directors here in Hong Kong and, believe me, they are independent. And they speak their mind and I’m very glad
22 NOVEMBER 2010
on preparatory work on parcels seven and eight. Mr Leven admitted that Sands China had no construction schedule or definite plans for developing the land. Mr Leven then told Macau Business that the
government had never discussed with Sands China the possibility of taking back parcels seven and eight if development was delayed. JP Morgan gaming analyst Joe Greff said the
government was unlikely to take the land from Sands China. “That said, we do believe the government is working with SJM and the other concessionaires so that each has a presence on the Cotai Strip,” he said in a research note. Mr Greff said if the government did take
parcels seven and eight from Sands China, the effect on its parent company, Las Vegas Sands, would be minimal because it would be offset by Las Vegas Sands’ new operations in Singapore and a stronger performance in Las Vegas.
they do,” Mr Adelson said at last month’s CLSA investors’ conference in Hong Kong. “I want Sands China to be as successful as Las Vegas Sands is. No bank or any investor has ever complained that I’ve cannibalised, that I’ve shifted profits from one to the other.”
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