G3Newswire ASIA & OCEANIA GAMING NEWS
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MALAYSIA – FIGHT FOR SECOND CASINO LICENCE Property developer Low Yow Chuan (pictured) says he was given a “first right of refusal” for a second casino licence in Malaysia and plans to use it to build a casino resort, if the govern- ment allows new operators into the market. Malaysia currently has just one casino operator: Genting Malaysia Bhd. Mr Low has said that he was given the right to build a casino by the Malaysian government in 1970. The right was later transformed into a “first right of refusal” for a second casino licence.
The octogenarian said the initial casino licence was offered as part of a deal with the government to build a hotel and country club in Langkawi, an archipelago to the north of the country, which were completed in 1973. He added that even- tually the casino plan did not go ahead because of lack of financing and supporting facilities for this kind of project in Langkawi. A plan to build the casino instead in Penang also fell through due to land issues, he said.
Mr Low, however, claims that the casino project was never dropped. He said that in 1993, he received a letter from the Malaysian authorities stating that “the government has no intention of issuing a casino licence presently, but if however, a reverse decision is made, Yow Chuan would be given an opportunity for ‘a right of first refusal’.”
The Malaysian tycoon said he is ready to use this prerogative to build a casino resort, if the government approves a second casino licence. The report says the project would involve an investment of up to MYR4 billion (US$1.26 billion).
Malaysian billionaire Vincent Tan announced last month that his company Berjaya Corp Bhd would re-apply for a licence to operate a casino at Berjaya Hills, a resort area in the state of Pahang. Mr Tan had applied for a licence to operate a casi- no at Berjaya Hills more than 10 years ago but it was rejected amid protests (see story opposite).
The Malaysian government has not announced any plans to grant a second casino licence.
PHILIPPINES – PAGCOR CLOSURE HURTS HOTEL The Grand Plaza Hotel Corp., the company behind Heritage Hotel Manila, barely eked out a profit in the first half of the year amid strong competition and lower rental revenues. In a regulatory filing, the hotel operator said as a result of lower revenue, net income slumped 96 per cent to P2.9m from P84.7m a year ago.
“Total revenue sank 29 per cent to P245.88m from P349.43m due to lower revenue in all segments especially in rental income,” Grand Plaza said. In July 2013, Philippine Amusement and Gaming Corp. (Pagcor) closed its casino that previously occupied 4,745sq.m. of the hotel with a monthly rental of P10.72m.
“The management of the corporation is in the process of exploring various options on how to develop and utilise the area covered by the leased premises,” Grand Plaza said. Pagcor is winding down its operations south of Metro Manila as mega-casinos start operations in the Entertainment City, the country’s answer to gaming hubs in Macau and Singapore.
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TAKE ME DOWN TO PARADISE CITY
Paradise and Sega Sammy have outlined their plans for the South Korean resort both companies plan to launch in 2017 South Korea - Casino Operations
Paradise Co. and Japanese partner Sega Sammy Holdings are set to break ground in October on the country's first integrated casino resort. Their Paradise City project near South Korea's main Incheon airport should open in early 2017, a year ahead of a nearby project planned by US-based Caesars Entertainment and Hong Kong's Lippo.
The company is banking on South Korea's prox- imity to northeast China and the popularity of Korean culture as a draw for Chinese gamblers. The number of Chinese tourists to South Korea grew nearly 53 per cent last year. South Korea's total casino revenue was about $2.5bn in 2013, less than six per cent of Macau's.
"There will be more rich people in China, and they will need to travel," says Choi Jong-hwan, CEO of Paradise Sega Sammy Co. "This is a megatrend."
Investors have sent Paradise shares up more than sevenfold since the start of 2011, the year the Seoul-based company tied up with Sega Sammy. Last month, Paradise raised 285.8bn won ($276.54m) in a sale of treasury shares.
The joint venture plans to open the first phase of the resort with casino, hotel, shopping, entertain- ment and convention facilities, at a cost of about
1tr won. The phase will include 120 tables, 400 slot machines and 300 electronic gaming tables. Mr. Choi said the company will also rely on junket operators to bring in 20-30 percent of its business, compared to the current 5 percent at its other casinos. Junket operators bring in high-rollers from China.
The conservative Korean culture at the moment has mostly kept South Koreans from fully enjoy- ing gambling. The country's only "open" casino at which Koreans can gamble is in a remote ex-min- ing town three hours from Seoul.
But the casino, operated by Kangwon Land earned 1.28tr won ($1.24bn) in revenue last year, nearly equal the 1.37tr won earned in the country's 16 smaller foreigner-only casinos. South Korea also faces potential competition from neighbour- ing Japan, which may open the country to casino gambling by 2020. "Many of the Koreans will be travelling into Japan to play the casinos and at that time, maybe the Korean government could be thinking of putting in an 'open' casino," Choi said.
Mr. Choi said Paradise City is not planned with the expectation that South Korea will eventually allow locals, but others say they see little chance the conservative country will ease the ban.
Taiwan trouble for Packer's Macau casino joint venture
TAIWAN Taiwanese prosecutors have charged a subsidiary of James Packer’s Macau casino joint ven- ture over the alleged illegal chan- neling of hundreds of millions of dollars between Taiwan and the gambling enclave.
The Taipei District Prosecutors Office indictment said the Taipei branch of Hong Kong-based MCE International transferred more than $NT5.4bn ($194m) in delib- erate violation of foreign exchange controls and financial oversight. It is understood the funds were transferred on behalf of high-rollers looking to gamble at Melco Crown’s City of Dreams and Altira casinos.
"The illegal conduct of the defen- dant MCE International and the other defendants is suspected to have harmed this country's financial order," stated the Taiwanese indictment.
The transfers in question took place between July 2009 and January 2013, when Rowen Craigie, Crown Limited’s CEO, was a director of MCE International, which is a subsidiary of Melco Crown, Mr Packer’s Macau joint venture with Hong Kong gaming tycoon Lawrence Ho.
Prosecutors have also applied to the court to confiscate $NT3bn in MCE funds that have been frozen since raids on its premises and other companies were executed in January 2013. The indictment from the Taipei District Prosecutors Office implicates four present and former employees including the branch’s current “responsible offi- cial” Wang Yen-sheng, and his predecessor Sung Hou-shuan.
Also named in the indictment were Taiwanese husband-and- wife management team who “set up” the Bo Ying VIP room at City of Dreams.
Vietnam Vietnam’s Ministry of Finance has finalised a draft decree aiming to allow Vietnamese to play in the country’s casinos although it will now have to be approved by Prime Minister Nguyen Tan Dung. If approved, gaming floors will be open to Vietnamese citizens aged 21 and up who have meet financial criteria to be outlined at a later date. The decree suggests that the Prime Minister will choose which properties will become accessible to local players. The draft decree also suggested a loosening of the laws regarding investment in casinos in Vietnam with the amount of experience needed being reduced from ten to five years. The investment limit would be kept at US$4bn with a maximum of 200 tables and 2,000 slots allowed.
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