ASIA & OCEANIA
As Crown Resorts exits both its Alon Vegas development and Melco Crown partnership, Lawrence Ho looks to the future flying solo
MACAU CASINO OPERATIONS All Hail the King as Melco Drops the Crown
Melco Crown Entertainment has said it will drop Crown from its name after Melco International took a controlling interest by buying shares from Crown Resorts.
SAIPAN – Despite operating one of the top earning casinos in the world, Fitch Ratings has warned that Imperial Pacific could default on its loans payments.
The operator recently revealed that its VIP table games rolling chip had surpassed US$32bn in 2016, but that hasn’t stopped the ratings agency from downgrading the Saipan casino group’s rating to a level that suggests ‘substantial credit risk.’
Imperial Pacific currently operates the temporary casino Best Sunshine Live whilst building the permanent venue; Imperial Pacific Resort in Garapan, Saipan, which will offer 300 gaming tables and up to 400 slots.
The Fitch downgrade focussed on the suggestion that Imperial Pacific does not have enough junkets in place. The casino will be offering commission rates of 1.4 per cent to VIP players it recruited directly; and 1.85 per cent to junket operators over the next three years.
“The downgrade of the final ratings reflects the company’s need to fund advances to customers and bear customers’ credit risk due to the lack of licensed junket operators in Saipan,” Fitch said. “So far only one junket has been licensed by the Commonwealth Casino Commission of Saipan. Imperial Pacific has been operating its VIP business through third-party introductions and internal marketing, with IPI granting credit directly to VIP customers who are partly backed by guarantors. Fitch believes IPI’s receivable days have expanded well beyond 100 days in view of the strong VIP rolling chips volume in the past six months.
Proposed notes, which will be issued by Imperial Pacific International (CNMI) LLC (Saipan), are rated two notches above IPI’s issuer default rating because they are secured by essentially all the assets of the casino and resort under construction and guaranteed by Imperial Pacific Properties (CNMI) LLC, which owns the lease of the land on which the resort is built, and by the parent, IPI.”
MONGOLIA – Mongolia is looking at legalising two foreigner-only casinos as it looks for its own slice of the Asian gambling market.
A Judicial Standing Committee has established a working group led by MP L.Enkhbold to draft legislation for the development of casino resorts.
Legislators are looking at the casino models currently used in Vietnam, South Korea and Cambodia where only foreigners are allowed to gamble. Mongolia shares borders with Russia in the north and China to the south, east, and west.
P36 NEWSWIRE / INTERACTIVE /
247.COM Macau
Imperial Beijing Palace fails to meet deadline Imperial Beijing Palace Hotel, the Macau hotel housing the Greek Mythology casino on Taipa has relinquished its operating licence saying that the government imposed deadline of January 22 to complete upgrades was ‘unfeasible.’ Te Macao Government Tourism Office had forced the hotel to close in July 2016 for six months as a punishment for ‘serious administrative irregularities’ and ‘illegal reconstructions.’ Its new owners Macau Hotel Developers has applied for “a work permit to remove all illegal structures currently encumbering the hotel and to undergo other mandatory refurbishment works.” Macau Hotel Developers said: “As a result of the severe problematic irregularities caused by, and inherited from, the former management of the company, namely Chen Mei Huan and Xu Jiaoji, the work permit applications are still under review and pending approval. In particular, authorities have raised concerns over ownership of the hotel’s land. Considering the imminent expiration of the temporary closure period (January 22, 2017), and the unfeasibility of completing renovation works before then, the company is forced to return its current hotel licence to the Macao Government Tourism Office.”
A spokesperson at Melco said it was ‘looking forward to a new corporate entity unveiling this new chapter of the company.’
Melco agreed to buy 198,000,000 ordinary shares or 13.42 per cent of Melco Crown Entertainment from Crown Asia Investments, a wholly owned subsidiary of Crown Resorts for US$1.2bn. Te deal takes Melco’s shareholding in the company from 37.89 per cent currently to 51.31 per cent. James Packer, a Crown nominee director and our Deputy Chairman, resigned from the company on December 15, 2016 after payment of the deposit by Melco Leisure. Te company expects to appoint in due course a director nominated by Melco to fill the board vacancy in accordance with its corporate governance policies.
Te company revealed that Crown Resorts would be entitled to payments if any Melco
Crown properties continued using the Crown brand. It said in a filing: “Te transition period shall be a period of one year following Crown or its affiliate giving notice of termination in respect of the use of the “Crown” name and other intellectual property rights as part of the branding in relation to the City Of Dreams Macau and the City Of Dreams Manila properties.”
Melco Crown recently celebrated the 10th anniversary of its NASDAQ listing with Lawrence Ho, Chairman and CEO of the company officiating the Opening Bell ceremony at NASDAQ MarketSite in Times Square, NYC.
Tere was no mention of the name change at the ceremony where Mr. Ho said: “Our 10th anniversary on NASDAQ is a memorable occasion to celebrate and cherish. Te Melco acquisition is certainly another tremendous milestone for the company. It demonstrates my positive outlook and faith in Macau’s long term future. Taking a majority ownership in MCE will enable us to effectively capture the growth opportunities in Macau and Asia’s markets.”
Vietnam
Vietnamese nationals who want to gamble at casinos as part of a three-year pilot scheme will have to meet four requirements at a time with family members able to prevent their relatives from playing. Vietnamese players will have to be at least 21 years of age and earn a monthly wage of at least US$440. Tey will have to pay $44 per day to enter the casino or $1,100 per month. Tey will only be allowed to play if there are no official requests from their family members, asking the casinos not to let them play. Tose whose family members, including parents, spouses or children, believe that they should not gamble will also be barred. Tese family members can send a letter to notify casinos and request a ban. Anyone under legal prosecution or with a criminal record will not be allowed to play at casinos. Te Vietnamese government will allow locals to enter two new casinos in two separate provinces.
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