The newest casino in Macau which was opened last week

Golden Sand Casino :
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The most famous casino in Macau - Hotel Lisboa

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This is the list of all the casinos in Macau :

Casino Lisboa

Casino Macau Palace

Casino Marina

Casino Taipa

Diamond Casino

Jai Alai Casino

Kam Pek Casino

Kingsway Hotel & Casino

Mandarin Oriental Casino
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MJC Casino and Grandview Hotel

New Century Casino
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The Legend Club

The Sands Macau

Time Magazine, May 31, 2004 / Vol. 163 No. 21

Macau's Big Scor

An old gambling town is being jolted out of its slumber by an influx of Las Vegas high rollers

BY MICHAEL SCHUMAN | MACAU

Macau's Portuguese colonial rulers legalized the city's first gambling house in 1847. But judging by the public reaction to the May 18 opening of the flashy Sands Macau casino, you would think the Macanese had just discovered sin. Encouraged by false rumors that the Sands planned to hand out free gambling chips, hundreds of people lined up in the early-morning hours hoping to get first crack at the baccarat, poker and blackjack tables. By the time the casino was opened to the public at 3 p.m., more than 15,000 had gathered in a pulsating scrum, ready to rush the lobby. Three sturdy plate-glass doors were ripped from their hinges and several little old ladies were nearly trampled in the ensuing stampede before police restored order by forcing stragglers back to the main street. As night fell, hundreds who failed to get in during the first wave disconsolately waited outside behind police barricades for a chance to place their bets.

Their time will come. The opening of the Sands Macau, a $240 million waterfront pleasure dome, offers Asia its first taste of Las Vegas glitz, and the casino will soon be followed by others like it. In 2002 the local government ended a 40-year monopoly on the gambling business, permitting two of Vegas' biggest gaming magnates to open up shop. The economic boom that has ensued is loud even by Chinese standards. While nearby Hong Kong's economy, with a total population 15 times the size of Macau's 450,000, grew just 3.3% during a SARS-marred 2003, Macau's gross domestic product exploded by 15.6%. Meanwhile, more than $3 billion of investment in casino and resort projects is in the pipeline. "Macau is just on fire," says Marc Falcone, a New York City-based gaming analyst for Deutsche Bank.

The sleazy, sleepy city is certainly in transition. Before Portugal handed Macau back to China in 1999, its architecturally charming but rundown streets were lined with hookers and occasionally reverberated with gunfire and car bombings from triad gang battles. The gambling business—which contributes 75% of Macau's government's revenue and supports the city's only major industry, tourism—has been the exclusive province of Stanley Ho, an elusive 82-year-old casino-and-property tycoon. His company, Sociedade de Turismo e Diversões de Macau (STDM), has not kept gaming operations in step with the times. The Lisboa hotel and casino, the flagship of 12 Macau gambling houses owned and operated by Ho, opened in 1970, and years of hard use are reflected in the venue's shopworn carpets and smoky, musty atmosphere. "The old casinos are just all tables for you to gamble," says Gigi Santos, a Filipina living in Macau.

Now, Sheldon Adelson and Steve Wynn, two formidable American entrepreneurs, aim to transform Macau into a first-class tourist destination for millions of Asians, mainland Chinese in particular. Adelson and Wynn are credited with reviving Las Vegas' flagging fortunes in the 1990s by building a succession of spectacular complexes that combine hotels, entertainment and gambling facilities, among them the posh Venetian (Adelson's best-known resort) and the Mirage (a project by Wynn). Today, with separate gaming licenses from the Macau government, the pair are racing to duplicate their U.S. success. Adelson, 72, built the Sands Macau, so he is first out of the blocks. But he says the Sands is just his ante. He plans to line up investors for a strip of 20 3,000-room hotel-casinos, costing, he estimates, $12 billion, including a $1 billion re-creation of the Venetian due to break ground in June. "I see an Asian Las Vegas" sprouting in Macau, says Adelson.

Those who attended the Sands opening enjoyed a similar vision. Inside the front door, showgirls in pink, sequined bikinis and multicolored feathers pranced and greeted visitors. Towering above the busy slot machines, a 33-m-wide video screen flashed fireworks and ocean sunsets. Waiters in traditional Chinese peasant hats scurried between the tables with free cups of tea. A jazz band jammed at the casino bar. At the "888 Las Vegas Buffet," gamblers stuffed themselves silly with all-you-can-eat sushi, pasta and Indian curries for $17 a head—a bargain by local standards. Behind wooden doors, big spenders, or "whales" in Vegas lingo, enjoyed quiet VIP rooms with plush maroon chairs and lofty windows where minimum bets can reach $130. Still to come: 51 luxury suites, some with a mansion-size 740 sq m of floor space, featuring saunas, karaoke rooms, private plunge pools and Jacuzzis with views of the harbor.

Adelson and Wynn point out they are adapting their winning formulas to suit Asians. For example, the Sands has gaming tables for fan tan and other games preferred by Chinese. A jackpot combination on specially adapted slot machines is the locally auspicious "888" instead of the traditional triple seven that wins big in the U.S. But no matter how Asian-friendly, gambling alone won't be enough to fill thousands of new hotel rooms. "Right now, Macau is for the gambler, period," says Wynn, who is planning to break ground on a $550 million hotel-casino he calls "the most ambitious in the Pacific Rim" later this year. "The trick is to add other dimensions to the town, open the door to people who haven't been going to Macau."

Is all this frenetic construction just a gamble that a whale might make? Adelson doesn't think so. "Risks? I don't think there are any," he says. And he might be right. Half of the world's population lives less than a six-hour flight away from Macau. The city has always attracted gamblers from Hong Kong and a few high rollers from mainland China. Beijing is now allowing more Chinese to visit Macau independently instead of in tightly controlled tour groups. A surge is under way—the number of mainland tourists to the former colony nearly doubled between 2000 and 2003. Last year, gaming revenues at Macau's 12 casinos increased 27% to $3.8 billion. Compare that with Vegas, where the 22 major casinos saw a mere 2.4% increase to $4.7 billion last year. Each table in Macau pulls in $22,100 a day compared with the $2,200 Vegas average.

The only person who seems likely to lose out in the new Macau is former monopolist Ho. "Stanley Ho is going to have to change his thinking," warns Adelson. Maybe. But Ho's daughter, Pansy Ho, an STDM director, is negotiating with MGM Mirage, the world's biggest casino operator, for a possible alliance. Ho is building a second, $250 million Lisboa across the street from the original. And he is also constructing a $140 million amusement park called Fisherman's Wharf, set to open later this year on a pier jutting into Macau's harbor. "We want to show Chinese tourists a place that's more family-style," says Ho's business partner, Macau-based property developer David Chow.

Last week, Ho didn't act very concerned. He stopped by the Sands' opening, grinning broadly while meeting his new competitors. "We have the opportunity to learn from one another," Ho told reporters. "The cake is going to be bigger and bigger and we all could have a share." Viva that, Las Vegas.

With reporting by Neil Gough and Carmen Lee/Macau

Geez....they can make space for that many casinos? Impressive! :)

They build casinos and hotels in the new reclaim land area .. :D (all concentrate in the South part of Macau). You will not find any other casinos in anywhere else of Macau ... :D and all the casinos must be 200 meters away from the school.


The size of Macau increased about 70% during the past five years .. (from 16km sq to 26km sq !! :D ... that's how small Macau is)

More than half of the area in Macau were reclaimed (Areas around Macau tower and the east part of Macau) ... especially in the late 80's at the time when the construction of apartments boomed).

MAY 29, 2004

New casino gives Stanley Ho a run for his money

The opulent Sands Macao casino has been attracting hordes of gamblers since its opening early this month

By Mary Kwang

MACAU - Eight out of 10 people who hail a cab in Macau these days want to go to the Sands.

So says local taxi driver Ng Kong Chun, describing how things have changed for him since the enclave's first American casino opened on May 18.

The remaining two would head for the Pu Kin, the local name for tycoon Stanley Ho's flagship casino, Lisboa, he said.

'Even though lots of taxis now queue at Sands, we only have to wait a minute for a fare, compared to 15 to 20 minutes at the Lisboa.'

Sands Macao, whose opening 10 days ago marked the end of Mr Ho's 42-year monopoly over the industry, is hard to miss as a landmark.

Passengers on board turbojets from Hong Kong can see its black and gold facade and the huge letters spelling out its name hundreds of metres away on the approach to the ferry terminal.

Even though it is an American outfit, Sands strives to cater to ethnic Chinese patrons, who account for 97 per cent of gamblers in Macau.

For instance, to hit the jackpot, a slot machine player has to line up the numbers 888, meaning to strike it rich, instead of the universal 777. There is also a 24-hour tea terrace offering 200 flavours of Chinese tea.

Although Sands is more opulent-looking than the Lisboa, which opened in 1970, visitors who have been to Las Vegas say that Sands still pales beside the offerings on the Strip.

One reason for this is that the amenities at Sands, such as more restaurants, will only be fully open in the next three months.

Sands is only the beginning of foreign investment in Macau's gaming and hospitality industry.

In the works are two more casinos owned separately by Hong Kong hotel tycoon Lui Che Woo and another American investor Steve Wynn.

Furthermore, the owner of Sands, the Venetian, plans by 2006 to transform a stretch of land between Taipa and Coloane islands into shopping malls, hotels, restaurants, family entertainment and convention facilities.

These rival developments have prodded Mr Ho into sprucing up his 12 casinos, including building a new 40-storey wing to the Lisboa.

Patrons say that the dealers at Mr Ho's casinos, who used to demand huge tips from winners, are now more restrained.

Ms Clavier Ng, Sands' public relations executive, said that it was too early to say how the opening of the new casino has affected the Ho stable.

The casino groups guard their operating statistics jealously. However, unconfirmed reports said that Sands has taken 13 per cent of the market.

A visit to the Lisboa on a Hong Kong public holiday, though, showed that its gambling halls were as crowded as before and the cigarette smoke just as thick.

The new developments have boosted confidence in Macau, which was returned to Chinese administration by Portugal in 1999.

Local resident Lou Po Chan said: 'Even the roads here are wider and well paved now. There are no potholes unlike in Portuguese days.'

More than the casinos, however, what has boosted the economy is the surge in tourist arrivals particularly after Beijing opened the doors to individual travel by mainlanders last July.

In the first quarter of this year, tourist arrivals increased by 25 per cent to 3.75 million compared to the same quarter last year.

Asked whether he was concerned about the triads as the number of casinos increased in Macau, Mr Lou said: 'We have had casinos for decades. We are used to it. In fact, the crime situation has improved a lot since 1999 because the government has clamped down on gang leaders.'

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Las Vegas showgirls on hand at the opening of Sands Macao. Despite being an American outfit, the casino strives to cater to ethnic Chinese patrons, who account for 97 per cent of gamblers in Macau. -- REUTERS

Friday June 4, 4:17 PM
Las Vegas gambling tycoon Steve Wynn to break ground on casino resort in Macau

Las Vegas gaming mogul Steve Wynn will soon begin construction of his casino-hotel in Macau now that the enclave has passed a law to let casinos extend credit to gamblers, an executive said Friday.

Wynn will be competing with another Las Vegas operator, Sheldon Adelson, who opened the doors to his Sands casino last month, and Hong Kong tycoon Stanley Ho, who has been running casinos in Macau for more than 40 years.

Gamblers in Macau have long borrowed money from loan sharks who hang out around the casinos. Wynn won one of Macau's three casino licenses in 2002, but had threatened to back out of his plans to build here unless Macau passed the law allowing casinos to extend credit.

Macau lawmakers unanimously passed the law Monday and it takes effect July 1.

An executive at Wynn Resorts Macau, Linda Chen, said by telephone Friday that Wynn's casino-resort will cost at least 4 billion Macau patacas (US$498 million) with 600 hotel rooms, 200 gaming tables and 350 slot machines.

Wynn plans to officiate at a groundbreaking ceremony in June, but no date has been set.

The company announced in newspaper advertisements Thursday said it will begin erecting fences around its 16-acres (6.5-hectare) site on Monday, and has asked people with cars parked on the land to get them out by Sunday.

Wynn's 20-year contract with the Macau government requires that his company invest US$512.8 million within seven years and finish construction of the first phase of its casino-resort by 2006.

Macau was returned from Portuguese to Chinese rule in 1999 and three years later decided to open up its crucial gaming industry to competition after a four-decade monopoly by Ho.

The tiny enclave is just 40 miles (64 kilometers) west of Hong Kong and attracts many gamblers from there.

MACAU – As reported by the Ponto Final: "Wynn Resorts says it will start preparatory construction works on its Outer Harbour site on Monday, June 7

"American gaming company Wynn Resorts announced on Thursday the start of construction of its four billion pataca casino-hotel tower in Macau.

"The company, which is headed by legendary Las Vegan gaming mogul Steve Wynn, made the announcement in paid advertisements in Macau's Portuguese and Chinese-language dailies.

"…The company's chief operating <span id="OFFICE" class=xxxxkeyword onmouseover="onmo(this);" onmouseout="inMenu=false;hide(this);">office</span>r in Macau, Linda Chen, told Ponto Final on Thursday that while preparatory construction works would begin with the site's hoarding on Monday, the formal ground-breaking ceremony would be held later in the summer. Chen said that Wynn would preside over the ceremony.

"…According to earlier announcements by Wynn Resorts, its Macau property will consist of a curved hotel-casino tower modelled on the company's current project in Las Vegas. A spokesman for the company told a media delegation visiting Las Vegas last year that its project in Macau would at least cost US $ 500 million, employ no less than 3,000 people and include 600 hotel rooms, 200 gaming tables, several 'fine-dining' restaurants, a <span id="SHOPPING" class=xxxxkeyword onmouseover="onmo(this);" onmouseout="inMenu=false;hide(this);">shopping</span> arcade, and a host of other resort amenities…"

The construction site
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MACAU – As reported by the Ponto Final: "Macau's casino sector generates record gross revenue of 15.1 billion patacas (US$1.88 billion) in first five months, up 'over 50 per cent' on same period last year

"Macau's 13 casino generated a record 3.4 billion pataca (US $ 425 million) gross revenue last month, when for the first time since 1937 two rival casino companies were vying for gamblers.

"According to an official source, Stanley Ho Hung-sun's 12 casinos raked in 3.31 billion patacas. His new rival from Las Vegas, Sheldon Adelson's Sands Casino that opened on May 18, made a gross revenue of around 90 million patacas, or just 2.6 per cent of the casino sector's total gross revenue last month.

"…According to Macau's new gaming legislation, the government directly collects 35 per cent of the casinos' gross revenue as tax…"

MACAU – As reported by the Ponto Final: "Macau's 82-year old gaming mogul Stanley Ho Hung-sun plans to open "several" new casinos over the next few years, a source of his casino company, Sociedade de Jogos de Macau (SJM), said on Tuesday.

"Speaking on condition not to be named, the source said possible locations for the 'several' new casinos were premises in two existing hotels in the Macau Outer Harbour, the four-star Nam Yue and the three-star Fortuna, as well as the New Yaohan Department Store near the Macau Maritime Terminal.

"…'We are just looking at possible sites and, of course, we would like to run more casinos,' the source said, adding, 'But nothing has yet been confirmed.'

"The source also pointed out that each new casino covered by SJM's concession agreement with the Macau government required an additional operating licence from the government…"

LAS VEGAS – Steve Wynn's Macau megaresort will cost about $705 million and include 600 rooms and 100,000 square feet of gambling space, the casino developer revealed in a Securities and Exchange Commission filing Thursday.

Wynn intends to begin construction June 28 on the Wynn Macau project, which will also consist of seven restaurants, approximately 28,000 square feet of retail space, a spa, salon and entertainment facilities.

"The contractors are obligated to substantially complete the project within 26 months after the date of commencement for a guaranteed maximum price of $255.5 million," the filing said.

Macau, a former Portuguese enclave, was returned to Chinese rule in 1999. Three years later, China decided to open up its vital gambling industry to competition after a four-decade monopoly by Hong Kong tycoon Stanley Ho.

A peninsula, Macau is about 40 miles west of Hong Kong.

Wynn decided to move forward with building the casino after the Legislative Assembly of the Special Administrative Region of Macau approved legislation last month enabling Macau casinos to lawfully extend credit to gamblers and enforce gambling debts. The new law takes effect July 1.

Wynn won one of Macau's three casino licenses in 2002, but had threatened to drop plans unless Macau passed the law.

Wynn Macau will lease a 16-acre parcel from the government for an initial term of 25 years, with a right to renew for additional periods, the filing said.

When the lease contract becomes effective, Wynn Macau is required to make an initial payment to the government of approximately $40 million, which will be paid in 10 semiannual installments. He'll make annual lease payments of up to $400,000, the filing said.

Wynn Macau also will pay approximately $17 million to Nam Van Development Company for its relinquishment of rights to a portion of the land.

Sheldon Adelson's Las Vegas Sands Inc. became the first American company to own and operate a casino in Macau. The company opened the $240 million Sands Macau casino on May 18.

Gambling giant MGM Mirage was not granted a development license from the Macau government, but the company is reportedly in talks with the daughter of Ho to build a casino there.

SYDNEY (Dow Jones)--Leighton Holdings Ltd. (LEI.AU) said Tuesday its Asian subsidiary, Leighton Asia, and China State Construction Engineering have been awarded a A$350 million contract to build a casino in Macau for Wynn Resorts Ltd. (WYNN).

The Australian construction and engineering group's share of the contract is A$175 million.

Under the contract, Leighton and CSCE will be responsible for the design and construction of a five star development that includes a hotel tower, gaming areas, nine restaurants, a retail arcade and a ballroom.

Design work has already started and the project is due for completion by the fourth quarter of 2006, Leighton said in a statement.

Leighton Asia Managing Director Will Hamilton said the casino project pushes its work in hand in Hong Kong, Macau and China to a record of A$925 million.

MACAU – As reported by Bloomberg: "Manuel Joaquim das Neves, Macau's Gaming Control Board director, is struggling with numbers.

"He has a four-page list of new gambling rules that need to be passed and a stack of plans for as many as 24 new casinos.

"Then there are 3.75 million tourists, more than half from China, who visited in the first quarter - a 25 per cent increase over last year.

"…'Last year, if someone told me that growth would be so fast, I wouldn't have believed them,' said das Neves, 44.

"…'They've only scratched the surface of the demand,' said Marc Falcone, 31, managing director and analyst at Deutsche Bank Securities in New York.

"'Macau can grow revenue 25 per cent a year over the next five years.'

"Gaming was the main attraction for the record 11.9 million tourists who visited last year…"

LAS VEGAS — Steve Wynn’s Macau megaresort will cost about $705 million and include 600 rooms and 100,000 square feet of gambling space, the casino developer revealed in a Securities and Exchange Commission filing Thursday.

Wynn intends to begin construction June 28 on the Wynn Macau project, which also will consist of seven restaurants, approximately 28,000 square feet of retail space, a spa, salon and entertainment facilities.

“The contractors are obligated to substantially complete the project within 26 months after the date of commencement for a guaranteed maximum price of $255.5 million,” the filing said.

Macau, a former Portuguese enclave, was returned to Chinese rule in 1999. Three years later, China decided to open up its vital gambling industry to competition after a four-decade monopoly by Hong Kong tycoon Stanley Ho.

A peninsula, Macau is about 40 miles west of Hong Kong.

Wynn decided to move forward with building the casino after the Legislative Assembly of the Special Administrative Region of Macau approved legislation last month enabling Macau casinos to lawfully extend credit to gamblers and enforce gambling debts. The new law takes effect July 1.

Wynn won one of Macau’s three casino licenses in 2002, but had threatened to drop plans unless Macau passed the law.

Wynn Macau will lease a 16-acre parcel from the government for an initial term of 25 years, with a right to renew for additional periods, the filing said.

When the lease contract becomes effective, Wynn Macau is required to make an initial payment to the government of approximately $40 million, which will be paid in 10 semiannual installments. He’ll make annual lease payments of up to $400,000.

Wynn Macau also will pay approximately $17 million to Nam Van Development Company for its relinquishment of rights to a portion of the land.

Sheldon Adelson’s Las Vegas Sands Inc. became the first U.S. company to own and operate a casino in Macau. The company opened the $240 million Sands Macau casino on May 18.

Gambling giant MGM Mirage was not granted a development license.

do you have the pics of the projects?

MGM Mirage, the US gambling group, reached a deal to open a casino in Macau with Pansy Ho, daughter of Chinese gambling magnate Stanley Ho, by late 2006 to gain a foothold in the former Portuguese colony that is Asia's biggest gaming market.


The resort, to be named MGM Brand, will be a 50-50 joint venture between the partners, MGM said. The new casino will operate under a subconcession agreement with Mr Ho's Sociedade de Jogos de Macau and be located on a waterfront site near the Hong Kong tycoon's flagship Lisboa casino complex. Financial terms of the deal were not disclosed and the Macau government must still approve the transaction.

The deal would enable MGM Mirage to catch up with its US rivals that have already staked claims in Macau's gambling market, believed to be one of the world's most lucrative. Casino operators are hoping to turn Macau into the Las Vegas of the east because of the millions of tourists it attracts each year from around Asia, especially China.

US tycoon Sheldon Adelson's Las Vegas Sands, which owns The Venetian in Las Vegas, became the first American casino to open in Macau in May and is planning a second resort complex. Galaxy Casino, partly owned by Mr Adelson, is building another casino.Wynn Resorts, owned by Steve Wynn, another Las Vegas gambling magnate, also plans to open its first casino resort in Macau by December 2006 and invest an additional $516m in the territory by 2009.

The venture also gives the Ho family a way to maintain its strong presence and influence in Macau, where their 40-year monopoly on the territory's gambling licence was ended by the city government in 2001 to open up the industry to foreign competitors.

"After they lost the monopoly they had to join the game," said a gaming analyst. "They can't just sit back."

The Ho family, which also runs businesses in property, hospitality and shipping through the Hong Kong-based Shun Tak Holdings, of which Pansy Ho is the managing director, earned $412m from its 12 casinos in Macau last year, a 50 per cent jump from a year ago.

The announcement came just one week after MGM Mirage sealed the takeover of its rival Mandalay Resort for $7.9bn in cash and debt, making it the clear leader in the US casino industry ahead of Caesars Entertainment and Harrah's Entertainment with control of about half of the 70,000 hotel rooms in Las Vegas.

However with its growth prospects in the US constrained by anti-gaming laws and heavy tax rates in many states, the company is pressing ahead with expansions abroad. Terry Lanni, MGM's chief executive, recently said he was bullish on prospects for expansion in London and regions in the UK, Singapore, Bangkok as well as Macau.

Mr Lanni said in a statement on Monday: "We are pleased to be entering the Macau market... We have always said we would like to participate in Macau under the right circumstances."

Analysts believe the time is right for foreign casino operators to enter Macau as the number of tourists, especially those from the Chinese mainland, keeps growing.

"These guys [international gambling companies] are definitely seeing the upward stage of the curve," said an analyst covering the gambling industry. "The potential of Macau is tremendous if you look at the number of tourists."

Macau attracted 11.9m tourists last year and 3.8m visitors in the first quarter of this year, half of whom were from the mainland.

Macau is trying to stay ahead of neighbours in leading Asia's gambling market, where Singapore and Thailand have both started considering to legalise gambling to boost tourism. As the main industry in Macau, gambling contributed two-thirds of Macau's government tax revenues last year.

That is just the proposal .. so i don't think you can find any pics at the moment

When the cavernous Sands Macau casino opened this summer it was hailed as the glitzy, high-tech vanguard for an army of Las Vegas tycoons hoping to tap the fast-growing Asian gambling market.

But unfortunately for the US owner, a local card shark has stolen the show from the imported chorus girls and dragon dancers, with a baccarat scam that netted 30 million Hong Kong dollars (US$3.85 million).

The sting, one of the biggest in Macau's history, took place last week but was only discovered on Tuesday, when casino managers checked footage from surveillance cameras.

novice croupiers

The perpetrator, identified only as Wong, is said to have swapped cards with accomplices to build up a multimillion-dollar winning streak without arousing suspicion among the novice croupiers working on the casino's 277 gaming tables.

Given Wong's reputation, it was a surprise that he was even allowed into the Sands. According to the South China Morning Post, the Hong Kong man had been barred by several gambling establishments in Macau and refused permission to board floating casinos off Singapore.

But the owner of the Sands, Sheldon Adelson, a Las Vegas mogul, is a relative newcomer to the former Portuguese colony, where 70 percent of tax revenues come from gambling.

He was the first rival to break the 50-year monopoly of the local tycoon Stanley Ho.

It would have been easy for the swindler to mingle in the vast crowds attracted by the new establishment, which boasts 93,000m2 of gambling space and a 36m chandelier.

Since it opened in May the Sands is said to have attracted 45,000 gamblers each day.

`highly embarrassing'

Sackings have followed the sting. According to the South China Morning Post, at least one executive has already been fired over this "highly embarrassing" incident.

Wong's fate is as yet unclear.

Police refused to confirm reports that he had been released on bail due to a lack of evidence against him.

He appears to have cashed in most of his chips. According to the Hong Kong newspaper Apple Daily, the casino had time to block the last of his winner's checks -- worth HK$5 million. Wong is said to have complained vociferously when the bank refused to pay out.

Wynn casino on 2009 deadline
Zach Coleman, HK Standard

Wynn Resorts must finish the second phase of its planned Macau casino resort by July 2009 under the terms of the company's land concession contract with the government, filed on Wednesday with United States regulators.

After much hesitation, Wynn Resorts broke ground on the first phase of the resort in June across the street from the Casino Lisboa. The company must complete the US$705 million (HK$5.5 billion) first phase by the end of 2006 according to its gaming concession.

Chairman Steve Wynn said in June that the government had indicated it would not be overly strict about the deadline, but the land contract says that if Wynn Resorts misses the deadlines for either phase, the company will be fined up to 5,000 patacas (HK$5,000) a day for delays of less than 60 days with fines doubling for delays of 60-120 days.

The first phase is to have 400 guest rooms, 200 suites and 100,000 square feet of gaming space. The second phase will add guest rooms and parking but not gaming space, according to the land contract.

Wynn Resorts' filing also said the company extended a US$25 million loan to its Macau subsidiary last month.

Separately, Las Vegas Sands said Garry Saunders has joined as vice-president for international operations. On Tuesday, MetroNews reported he had been recruited to oversee the company's Macau operations.

Spokeswoman Alpha Padilla added that Thuy Trinh, who has been managing the Macau operations since last autumn, has not resigned from his post as chief operating officer.

The Sands Macau is Las Vegas Sands' only overseas outpost at the moment, but the US company is developing the larger Venetian Macau resort as part of its US$5 billion-US$10 billion Cotai Strip project.

In March, Las Vegas Sands signed an agreement with Britain's Glasgow Rangers and Sheffield United football clubs to help them develop gaming facilities.

The company is also exploring opportunities to open its own casinos in the United Kingdom.

5 August 2004 / 03:26 AM

Executives for Venetian owner Las Vegas Sands Inc. said Tuesday the company is moving quickly to cash in on a small part of the world that is expected to surpass Nevada in a few years as the world's largest gambling destination.

Macau, a Chinese coastal territory that is less than an hour by boat from Hong Kong, has attracted major U.S. investors including Wynn Resorts Ltd. and MGM MIRAGE. They broke a decadeslong monopoly held by casino boss Stanley Ho whose casinos catered to high-rolling gamblers who were known to obtain credit from Asian gangs.

Executives at Las Vegas Sands, which opened its Sands Macau casino May 18, said they are flouting conventional wisdom by catering to an emerging mass market of Chinese who have newfound wealth and a desire to travel but who aren't dropping thousands at the baccarat tables.

And they say they will expand the Sands Macau -- as well as build a previously announced resort there similar to The Venetian -- as fast as they can.

"There's a billion people within a two-hour travel time already," Las Vegas Sands President Bill Weidner said during the company's second quarter earnings call Tuesday. "I don't know if Macau has enough room to handle capacity. I don't know if you can (have) enough (gaming) tables."

The company isn't waiting for Macau regulators to pass expected rules allowing casinos to extend credit to gamblers -- an event that some experts said was a near requirement for doing business in Macau.

"We are (glad) we got there early because the market in Macau is pretty phenomenal," Las Vegas Sands Executive Vice President Brad Stone said during the conference call.

Profit at the company more than doubled from a year ago, in part because of the opening of a new hotel tower at The Venetian as well as early results from the Sands Macau casino.

"There's well over a billion dollars' worth of opportunity on the mass market side with little or no cost of acquisition," Weidner said. "What we saw was a good, high margin business without extending one dollar of credit."

Casino boss Steve Wynn originally said he wouldn't move ahead in Macau without credit legislation in place but has since begun development, saying he is confident rules will pass allowing casino credit as well as the ability to offset taxes on casino winnings by deducting uncollectible debt.

Visitor volume in Macau is increasing about 50 percent a year, with each person bringing about $6,000 in cash, Weidner said.

By the end of this month, Sands Macau will open a series of amenities aimed at cash-paying tourists, including 49 high-end suites, four restaurants, karaoke bars, a cigar bar, tea tasting rooms and spas.

There's another billion dollars' worth of market potential in a high-end segment of customer who brings cash and doesn't need credit, Weidner said. Other tourists avoid Macau altogether because they're not big gamblers, he said.

Macau is largely a locals' market fed by nearby Chinese zones that have become well-to-do under recent free trade policies, analysts say.

"The mass market is what's growing," said Scott Fisher, a managing director with Innovation Group, a New Orleans-based consultant for gaming and hotel companies.

"There's relatively wealthy communities and cities in the southern Guangdong province where everything's brand new. These are people with newfound wealth and going to Macau is an opportunity they now have but they're not serious gamers," Fisher said.

"People enjoy the whole resort concept just like they enjoy the resort concept in Las Vegas," he said.

The company's Macau business can stand on its own without serving as a feeder market to Las Vegas, Key Banc Capital Markets analyst Dennis Forst said.

"They don't need to bring one customer over here (to Las Vegas) to have it make economic sense in Macau," Forst said. Any cross-marketing with The Venetian "is kind of whipped cream on top of the cake."

Both Las Vegas Sands and Wynn have a track record of catering to Asian gamblers in Las Vegas and have indicated a desire to market their Vegas casinos in Macau.

MACAU – As reported by the Ponto Final: "Macau police announced on Tuesday the arrest of a Hong Kong mini-bus driver who allegedly used a fake credit card to pay back a HK $ 90,000 debt to loansharks in Hong Kong.

"According to a police spokesman, the 60-year old suspect, surnamed Leung, was arrested on Sunday, following a tip-off by a casino operator in Macau's Outer Harbour.

"…The spokesman said the suspect told police he had used the credit card for three consecutive days last week to buy junket-gaming chips worth HK $ 350,000.

"The spokesman also said the suspect told police he had been forced by several loansharks in Hong Kong to use the fake credit card at the casino in Macau in order to pay them back a HK $ 90,000 debt…"

MACAU : A huge cheer breaks through the cacophony at Sands Macau Casino as the four million pataca (518,000 US dollar) blackjack jackpot is won.

Lights flash, music plays and hordes of tourists, mostly from mainland China, gather around to congratulate the beaming winner.

Later, by the huge cocktail bar, two scantily clad Western girls gyrate on podiums to the muzak of a house band fronted by two equally skimpily attired female singers.

Overhanging the slot machines and the baccarat, roulette and card tables, a gigantic video screen the size of a tennis court flashes pop videos and ads for other casino attractions, including the upstairs buffet in a restaurant as big as two football pitches.

Gambling Macau-style has changed dramatically since Sands, a subsidiary of the Venetian company that owns its namesake hotel-casino complex in Las Vegas, opened in May.

It has brought Vegas pizzazz to the largely autonomous Chinese territory in an industry that had been dominated by dingy, smoke-filled dens since gambling was legalised by the Portuguese colonial government a century ago.

With the emphasis on entertainment above gambling, it is the first in a 25-billion-pataca wave of new casino openings that are already revolutionising an industry which just five years ago had gone into reverse.

At least another 30 similar American-style casino-resorts are planned, which by 2009 are expected to pull in more than five billion US dollars annually -- outstripping takings even on Las Vegas Strip.

"The numbers are scary," said economist Albano Martins. "And by all projections, they are just going to get bigger and bigger."

When China resumed control of the territory in December 1999 gaming, long the pillar of the local economy, was on the wane as the economic slump in Hong Kong, a 45-minute ferry ride away, deterred its traditional source of punters. That year casinos took only 13 billion patacas.

Since then the picture has been transformed: according to government figures, gaming receipts had reached 22.5 billion by June this year, almost equal to the 28 billion taken in all of 2003. Martins expects the year-end figure to be 42 billion patacas.

The Macau that political leader Edmund Ho was re-elected to run on Sunday is much changed from the territory he inherited five years ago.

"Another way of looking at it is this: the gaming industry pays 39 percent of takings in tax. That means that by July, from gaming tax income alone, the government has already paid its budget for 2005," Martins says.

Driving this sudden boom is a huge surge in mainland Chinese visitors.

Since Beijing last year eased restrictions on travel outside the country, Chinese tourism here has mushroomed: from a trickle in 1999, Chinese arrivals soared to six million in 2003 and by June 2004 had already accounted for five million of the city's 7.7 million visitors.

"The mainland is Macau's golden goose," says Sanjay Nadkarni, a researcher at Macau's Institute for Tourism Studies.

Growth is expected to rocket further.

"To fund its expansion plans, the gaming industry has banked on a 50-percent annual growth rate in mainland visitors for the foreseeable future," said Martins. "The figures so far show they will reach that easily."

But for all its glitz and glamour, Sands is small-fry here: in June, its first full month, it took 320 million patacas, according to government figures, just two percent of the almost four billion patacas spent by gamblers that month.

Even Galaxy, the Hong Kong-owned company that entered the market at the same time, raked in 400 million with far fewer tables.

It has led some to doubt the American model in Macau.

"The Chinese operators understand the local market better because they have been here longer," said Martins.

"The Americans say they will bring in the holiday gamblers but the Chinese casinos are making money from VIP tables, which Sands so far doesn't have."

The high rollers of the VIP rooms provided an estimated 80 percent of the 3.3 billion patacas taken in June by the largest and oldest casino operator: Stanley Ho's SJM.

Ho held the monopoly on gambling here for four decades until this year when the government of Beijing-backed chief executive Edmund Ho (no relation) introduced new legislation allowing foreign competition.

Through his huge conglomerate STDM, Stanley Ho controls much of the economic activity of Macau. Apart from his 12 casinos he owns the ferry company and port, he has a large share in the airport and he controls some of the most prestigious hotels and tourist attractions.

Viewed here as a benevolent uncle, few know why the government decided to break Ho's grip on the city.

"Stanley controls so many rugs he could easily have pulled from under the economy, I think the government wanted to spread the risk," suggests Nadkarni.

"I think Stanley was seen as too powerful," says local legislator Antonio Ng Kuok Cheong, who opposes the casino expansion plans.

"But I think it also made sense because there was a genuine desire to inject new life into the local market."

Sands Macau is just a taste of things to come. On a 100,000 square metre reclamation between two islands called the Cotai strip it is leading a development that will by 2009 house at least 25 American-style resorts and casinos, including the billion US dollar Venetian Macau.

As well, Ho plans two theme parks and the 40-storey Grand Lisboa casino hotel.

Nearby, Galaxy has begun building what will be a 13-storey gambling haven; across the road Las Vegas tycoon Steve Wynn will open a 600-room, 200-table complex; and there has even been talk of MGM, which pioneered the family casinos in Vegas, opening a property with Ho's daughter Pansy.

When it is complete by 2009, the Cotai strip will provide some 30,000 hotel rooms -- 4,500 at the Venetian alone -- about 1,000 gaming tables and at least 100,000 square feet of convention space.

The strip is expected employ some 150,000 staff.

Many distrust relying on one industry but with no nearby competition and China -- though morally and politically opposed to gambling -- committed to maintaining Macau as the nation's only casino haven, problems, for now, look far away.

"No one can see an end to the gambling jackpot," says Martins.

MACAU – As reported by the Agence France-Presse: "…Gambling Macau-style has changed dramatically since Sands, a subsidiary of the Venetian company that owns its namesake hotel-casino complex in Las Vegas, opened in May.

"It has brought Vegas pizzazz to the largely autonomous Chinese territory in an industry that had been dominated by dingy, smoke-filled dens since gambling was legalised by the Portuguese colonial government a century ago.

"With the emphasis on entertainment above gambling, it is the first in a 25-billion-pataca wave of new casino openings that are already revolutionizing an industry which just five years ago had gone into reverse. At least another 30 similar American-style casino-resorts are planned, which by 2009 are expected to pull in more than five billion US dollars annually -- outstripping takings even on Las Vegas Strip.

"…Driving this sudden boom is a huge surge in mainland Chinese visitors.

"…But for all its glitz and glamour, Sands is small-fry here: in June, its first full month, it took 320 million patacas, according to government figures, just two percent of the almost four billion patacas spent by gamblers that month.

"Even Galaxy, the Hong Kong-owned company that entered the market at the same time, raked in 400 million with far fewer tables.

"It has led some to doubt the American model in Macau.

"…The high rollers of the VIP rooms provided an estimated 80 percent of the 3.3 billion patacas taken in June by the largest and oldest casino operator: Stanley Ho's SJM…"

ECONOMIC CONCERNS: The gambling industry's growth boosted GDP by 25 percent in the first quarter, but some warn that Macau must diversify its economy

On the western edge of Macau, along the slither of polluted water that separates it from China, restaurateur Effic Chen serves the handful of customers who still visit her San Hip Seng Seafood Restaurant.

Business has dropped "enormously," said Chen, in the two years since the local casino, a dingy gambling den built into an old Chinese junk, moved to the other side of the peninsula to be closer to a glitzy new American casino.

The 24-hour floating casino brought a constant flow of customers to Chen's restaurant and the many other bars, eateries and stores in the neighborhood. Now they are either boarded up or eerily quiet.

"We used to be full all the time," Chen sighed. "Now look," she said,pointing to the empty tables.

The slump in Chen's tiny neighborhood of the largely autonomous enclave of China is symptomatic of a recent economic shift in Macau that saw casino growth boost GDP by 25 percent in the first quarter.

It is one of many clouds behind the city's economic miracle that political leader Edmund Ho, who was re-elected for a second term in office Sunday, can't afford to ignore.

"We are relying too much on one industry and that reliance is only going to increase," warned Sanjay Nadkarni, a researcher at Macau's Institute of Tourism Studies. "We are creating a monoculture built around a business that is, essentially, non-productive."

Macau is mutating into the entertainment center of China: Some 25 billion patacas (US$3.2 billion) has been pledged to build 30 new casinos and hotels in the next five years and business in the existing 13 is booming thanks to a doubling of mainland Chinese tourists this year following newly relaxed travel rules in China.

Leading the revolution are American casino operators from Las Vegas who are bringing glitz and a business model that places casinos within huge hotel and entertainment complexes, far different to the city's traditional gambling dens.

But away from the neon and green baize, analysts and politicians warn of dire economic and social consequences.

"What happened to the floating casino is happening all over the city," said lawmaker Au Kam Sam, a teacher and one of just two lawmakers on the city's 30-seat legislature who opposed expansion of the casino industry.

"The old casinos used to bring business to their neighborhoods because all they provided were gaming tables -- no food or drink.

"The new American casinos, however, will provide everything: there will be no need for other service providers nearby. So, small shops and business will now go bust."

Macau's casinos presently account for 80 percent of economic activity here; the rest is based in textiles. Gambling levies last year paid for 77 percent of the government's budget. Next year it will pay it all and provide a surplus to boot.

Nadkarni fears for such a lopsided economy.

"There is a lack of investment in intellectual capital," he said. "Tertiary colleges have closed regular courses to train croupiers and dealers for the casinos.

"It will produce a workforce geared only to serve the casino industry. What happens if the bottom falls out of gambling?"

Although Ho's Beijing-backed government is planning a free trade zone at the city's border with China, observers say little is being done to counterbalance a possible casino crash.

"It could happen very easily if Thailand or Singapore opens good quality casinos. The people here know they need to [broaden the economic base] but nothing serious is being done about it," warned one economist.

The casino expansion plans include the construction of the so-called Cotai strip on a huge reclamation, which when complete in 2009 will employ 150,000 staff at its 30,000 hotel rooms and 1,000 gaming tables.

Wynn Resorts buys out local partners

Wynn Resorts has raised its investment profile in Macau by buying out its local partners with US$52.2 million (HK$407.1 million) worth of its own stock.

The company, run by mogul Steve Wynn, is building a US$705 million casino resort set to open next to the Casino Lisboa by the end of 2006.

The American company revealed the buyout of its local partners in a filing last week with the US Securities and Exchange Commission (SEC). Rival Las Vegas Sands also released details of its relationship with its local partners and its development plans in Macau in a preliminary SEC filing last week for its planned initial public stock offering.

Wynn Resorts' filing said it issued a combined 283,333 shares to two companies owned by Wilson Kwan of Hong Kong, and 1,050,000 shares to two companies owned by Wong Chi-seng, a Macau businessman. In exchange, Kwan and Wong yielded their combined 17.5 per cent indirect economic interest in Wynn Resorts (Macau).

The company's stock has tripled in value since its IPO in October 2002 although it peaked in mid-June, ironically about the time the company announced it would finally move forward with construction in Macau after a two-year delay. Wong and Kwan will join Lan Kwai Fong Holdings chairman Allan Zeman, a Wynn Resorts director, as shareholders.

Previous company filings with the SEC listed other local investors, including the couple Li Tai-foon and Yany Kwan of Hong Kong's Air Cruise Travel, but they apparently sold their stakes to Wong some time ago. As a group, the local investors contributed US$5 million in capital.

Wong will remain executive director of Wynn Resorts (Macau) and retain a 10 per cent voting stake in the unit but will be eligible for no more than one Macau pataca (97 HK cents) a year in dividends and capital distributions, in accordance with the company's interpretation of Macau's gaming law.

Las Vegas Sands' prospectus states that two minority shareholders hold a combined 10.005 per cent stake in its Macau subsidiary, but it says both have assigned all ``economic, voting and other rights'' to a Las Vegas Sands' unit.

The Standard previously reported that Macau attorney Jorge Valente serves as executive director and 10 per cent shareholder of the Macau subsidiary.

The prospectus reports that the Sands Macau posted a net profit of US$36.9 million during June and July.

The filing says the Sands Macau is not issuing credit to gamblers despite Macau's new gaming credit law because the company cannot take a tax deduction for uncollected gaming debts.

Updating Las Vegas Sands' plans for its second local property, the Macau Venetian Casino Resort, it says the casino will feature about 546,000 square feet of gaming space. While the Sands Macau focuses on daytrippers, the filing says, the Macau Venetian will aim to attract overnight guests.

The filing says the government has given the company the right to control development of two nearby resort sites and to develop four additional sites in co-operation with third parties in the reclaimed area between Coloane and Taipa islands.

After 15 months of structuring, Wynn Resorts (Macau) has finally closed its first round of senior funding. The facility is split into a US dollar tranche and a Hong Kong dollar tranche and both are further divided into a project facility and a hotel facility.

There is a term loan is for $382 million and a revolving credit facility for HK$117 million ($15 million). The term loan has a maturity of seven years and carries a price of 350bp over Libor. The facility has a two grace period from signing and then follows an amortization schedule. The average life is 5.35 years.

The Hong Kong dollar tranche has a maturity of three years and also carries a spread of 350bp over Hibor, 100bp more than was earlier reported.

Both facilities have recourse to Wynn Macau, which is 90% owned by Wynn Resorts of the US and 10% by local partner Wong Chi Seng. There is no guarantee on the facility by the parent company and no recourse to Wynn Resorts.

Global coordinating lead arrangers (GCLAs) on the deal are Deutsche Bank and SG. They pulled together an interesting syndicate of 14 other banks attracted to the relatively fat spreads on offer.

Senior lead arrangers taking just over $40 million were Aozora Bank, Banco Nacional Ultramarino, Bank of China (Macau) and Shinsei Bank. Lead arrangers were Korea First Bank with a $35 million take and WestLB with $30 million. Banco Comercial de Macau is an arranger with $25 million. Also on $25 million but as a lead manager is Allied Irish Bank. Other lead managers were Canadian Eastern Finance, which took $15 million, ICBC (Macau), which took nearly $12 million and Banco Espirito Do Oriente which took $10 million.

There were three lenders to the Hong Kong dollar facility: Banco National Ultramarino with HK$47 million; Banco Comercial De Macau with HK$40 million and Banco Delta Asia with HK$30 million.

The deal took a long time to structure as lenders had to get comfortable with the new rules surrounding the gaming sector in Macau. Since the new regulations came out in 2001, three new concessions have been awarded. In the process, the government has had to change its own legislation to accommodate a non-monopoly environment. As a result, the structuring of this loan had to go hand in hand with discussions with the government to make sure that everything dovetailed.

For instance, the lenders and the government had to work out how the concession rights to the license would be assigned to the lenders in the case of a bankruptcy. As the banks are not casinos (well, not with their own money), they would not be entitled to run the casino, so a way had to be found to ensure that the banks could transfer those rights to a qualified operator.

"We needed to perfect the security of those gaming assets under the new legislation," says Paul Smith, Deutsche Bank's co-head of debt products for Asia. "It was quite an exercise. It wasn't just a pure financing but it required a lot of coordination with the government."

Adds SG's head of project finance and advisory, Ashley Wilkins: "We believe the financing is a result of the complementary strengths of the parties involved and the high level of cooperation between Wynn Macau, the GCLAs and the numerous other parties involved in structuring the financing, including the Macau SAR Government"

Pricing for the deal was also an exercise in discovery. According to Smith, there were very few reference benchmarks for this deal and the leads had to use a combination of pricing for Macau risk, as well as recent pricing for Vegas deals. "It was very difficult to gain an accurate benchmark for this deal from just Asia," he says.

Still, the bankers clearly would have enjoyed their due diligence, which in particular would have involved some close scrutiny of the recently opened Sands Resort Macau. Anyone going to Macau in recent months could not fail to notice how popular this casino is with people stacked five deep at the myriad tables in a gaming hall the size of a football field.

"There has been a lot of interest in the Sands and we have been monitoring this," says Smith. "The early signs are that it will be very successful and we are certain that Wynn Macau will be the same. It shows it has a very strong business model."

Wynn Macau will be a hotel, shopping and destination gaming resort on a 16-acre site. With 600 rooms and 100,000 square feet of gambling space, it will be one of the biggest such casino complexes in Asia. The total project cost is expected to be $700 million, with roughly 50% of the cost coming from the shareholders' equity and 50% through this debt facility.

Asian casino earns $36.9 million in first two months open, filing shows

The first American-owned casino in Asia, the Sands Macau, exceeded all expectations with its first two months in operation and laid a foundation for the Las Vegas Sands Corp. to reach its goal of becoming the world's leading high-end casino resort operator, company documents filed with the Securities and Exchange Commission said.

The 1 million-square-foot casino-and-entertainment complex is already rivaling any casino operation in the West, Wall Street analysts said Tuesday.

"The early numbers show a property poised to be among the top cash flow generators compared with anybody else in the West," Susquehanna Financial Group gaming analyst Eric Hausler said.

The casino posted net income for the two months ended July 31 of $36.9 million and earnings before interest, taxes, depreciation and amortization, or cash flow, of $41.2 million, based on a table drop of $608.2 million, the $350 million stock registration statement the Las Vegas Sands holding company filed Sept. 3 shows. Total drop is the amount wagered and lost at table games and slot machines.

Joe Greff, gaming analyst at Fulcrum Global Partners, an independent Wall Street investment research firm, said the early financial results suggest the company, which also owns The Venetian, will generate enough profit in the first 12 months to pay off its entire initial investment in Macau.

"That's just unheard of in the U.S. or any other North American gaming market -- and that didn't include the high-end areas and reflected inexperienced dealers and typical startup difficulties," he said.

The $240 million Sands Macau is owned by Sheldon Adelson's Las Vegas Sands and has 319 table games, 600 slot machines, 18 restaurants, bars and entertainment venues near the ferry terminal in former Portuguese colony.

The company's registration statement said it plans to use its "first-mover" advantage in Asia and uniquely branded gaming and entertainment properties to drive record returns on investment and pave the way toward its goal of becoming the world's leading casino operator.

The Sands Macau opened in May and had more than 1 million visits in July alone.

"Macau will be a huge growth driver for the company, not only because they're there first, but because they have a plan to build on their success in Las Vegas," Deutsche Bank analyst Andrew Zarnett said.

Ultimately, he said Las Vegas Sands' $10 billion Cotai Strip development in Macau will include not just a Venetian-style resort, but also a variety of third-party hotels with smaller casinos that will pay a share of their income to the Sands in fee income.

The Cotai Strip, an area of reclaimed land between the islands of Taipa and Coloane in Macau, has been master-planned as a world-class resort area with up to 20 hotel-casinos, to be developed by eight operators, and up to 60,000 rooms and entertainment amenities.

On one of the sites, Las Vegas Sands plans to build, own and operate The Macau Venetian, a Venetian-style 3,000-suite hotel-casino and 550,0000-square-foot convention center complex, which is scheduled to open in 2006.

Las Vegas Sands has been granted control of two of these remaining sites and has received approval from the government of Macau to develop four other sites in cooperation with third parties.

"This is visionary. (Adelson) is involving a lot of other companies by bringing their brands to his market," Zarnett said. "He's going to create a minicity with the focal point being The Venetian. He not only benefits from his experience running a casino, but he gets to leverage huge international databases as the other companies market their properties and ultimately market his (at the same time)."

Hausler added: "Adelson is developing all this in the midst of what is arguably the best gaming market in the world right now. And it's expected to grow dramatically in the next decade because of the leadership role the Sands is taking. It's a critical piece in the growth strategy for them."

In addition, University of Nevada, Las Vegas professor Bill Thompson, who specializes in gaming studies, said Adelson's long-range plans for hotel developments will create destination options not now available in Macau, which will draw a larger number of visitors and accelerate revenue growth for Las Vegas Sands.

"Right now it's a cash cow for him, it's a grind joint. They need to find their best players and sort this out," he said. "When they do, Adelson will being them here and that'll really be great for Las Vegas."

In its stock registration statement, Las Vegas Sands says it plans to use its successes in Las Vegas and Macau as a platform for worldwide growth.

The company is exploring the possibility of operating casino resorts elsewhere in Asia, including Singapore, Japan and Thailand.

It also claims to be well-positioned to capitalize on the expansion of casino gaming in other international jurisdictions, such as the United Kingdom and is pursuing the possibility of developing and operating an Internet gaming site.

Las Vegas Sands plans to raise $350 million with the stock offering and to use the proceeds to fund these international developments, as working capital and for general corporate purposes.

Las Vegas Sands is in a "quiet period" while its stock registration statement is pending before the SEC, and company officials declined to comment.

Macao's casino tycoon Stanley Ho announced Thursday that his flagship casino company would offer a 7 million-pataca (875,000 US dollars) lucky draw at the opening of the Mona Lisa Gambling Hall.

In celebration of the second anniversary of the Macao Gaming Co.Ltd.(SJM), which was founded by Stanley Ho to enter the bidding ofthe government-issued casino operation concession, the Mona Lisa lucky draw will be held from Sept. 17 to Oct. 18, and the prizes will be over 7 million patacas.

Ho said that the Mona Lisa Hall housed in the Hotel Lisboa is the third theme gambling hall opened by SJM to cope with the new competition situation of Macao's gaming industry.

Stanley Ho's gaming empire had a monopoly on Macao's gaming market for four decades until 2002, when the Macao Special Administrative Region government broke the monopoly by issuing three casino licenses.

The first American casino Las Vegas Sands Macao was opened in May, which was soon followed by the unveiling of the Hong Kong-invested Galaxy Waldo in early July.

SJM, which now runs 12 casinos, still dominates the mainstay of the market. It has taken its new bet on the theme attractions of the Italian-styled Crystal Palace, the Egyptian-flavored Pharaoh Hotel and the Mona Lisa Gambling Hall to compete with its rival companies.

From Taipei Times

'On a 100,000m2 reclamation between two islands called the Cotai strip, it is leading a development that will by 2009 house at least 25 American-style resorts and casinos, including the US$1 billion Venetian Macau. As well, Ho plans two theme parks and the 40-story Grand Lisboa casino hotel.'

(Xinhua)
Updated: 2004-09-24 14:05

The Finance Services Bureau of the Macao Special Administrative Region government raked in a record 9.25 billion patacas (US$1.15 billion) in gaming taxes in the first eight months of this year.

The bureau's statistics released Friday showed the year-on-year tax increase amounted to 50.3 percent in the first eight months.

For the whole of last year, the government collected 10.17 billion patacas (US$1.27 billion) in gaming taxes.

The following tourist boom in October and December is expected to further boost the revenue of the gaming sector, which contributes to 76 percent of the government's tax revenue, according to the bureau's August statistics.

During the period, the government's budget surplus reached 5.56 billion patacas (US$695 million), an increase of 121.7 percent from the same period of last year.

Macao's gaming tax hits record high in January-August

The Finance Services Bureau of the Macao Special Administrative Region government raked in a record 9.25 billion patacas (1.15 billion US dollars) in gaming taxes in the first eight months of this year.

The bureau's statistics released Friday showed the year-on-year tax increase amounted to 50.3 percent in the first eight months.

For the whole of last year, the government collected 10.17 billion patacas (1.27 billion US dollars) in gaming taxes.

The following tourist boom in October and December is expected to further boost the revenue of the gaming sector, which contributes to 76 percent of the government's tax revenue, according to the bureau's August statistics.

During the period, the government's budget surplus reached 5.56 billion patacas (695 million US dollars), an increase of 121.7 percent from the same period of last year.

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MACAU – As reported by the Scotman: "…Inside its golden chrome-panelled exterior, the Las Vegas-funded Macau Sands Casino is already changing the way the former Portuguese colony does business.

"Opened in May, Sands is the first in a long list of planned casinos and hotel resorts that supporters hope will make their city the gambling centre of Asia, if not the world.

"Reclaiming land from the South China Sea, Macau expects to have more than 30 major resort hotels by 2009, the majority built with United States backing.

"…Bringing in revenues of $373 million (£209 million) for the treasury in the first five months of this year alone - an increase of 32 per cent over the same time last year - gambling remains the primary source of income for the government. The feeling now is that the city needs to diversify its economic base.

"…In effect aiming to mirror the success of The Strip, which 20 years ago was only famous for its casinos, Macau hopes to use Las Vegas know-how to reposition itself as a destination for families, business conventions, sightseeing and shopping.

"With a Disneyland due to open in Hong Kong next year and regulations regarding individual travel from mainland China being relaxed, all indicators are pointing to an explosion in traveller numbers…"

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Skynet (International Group) Holdings, a construction arm of builder Paul Y-ITC Construction, is in talks to build a hotel-casino complex in Macau for tycoon Stanley Ho that is reportedly worth HK$1.3 billion.

Paul Y-ITC's deputy managing director Billy Wong confirmed the company was in talks on a contract to build a hotel but declined to disclose the contract size and the hotel's owner. ``The negotiation has yet to be confirmed,'' he said. ``I suppose we are not the only contractor in the negotiation.''

Several other contracts were under negotiation in Macau and Hong Kong, Wong added.

According to a Hong Kong Economic Journal report on Monday, the contract covers construction of a six-star hotel and a casino. The hotel, comprising about 400 guestrooms, would be ready for operation by 2006.

They were part of the high-end hotel and entertainment complex being jointly invested by Stanley Ho's Hong Kong-listed Melco International Development and Sociedade de Turismo e Diversoes de Macau (STDM).

Melco would be the co-ordinator of the hotel and entertainment complex while the Hyatt Hotels Group would manage the hotel facilities.

The casino would be run by STDM's unit, Sociedade de Jogos de Macau (SJM), and the electronic gaming lounge, by Melco's unit, Mocha Slot Group. The joint venture would receive rental income from Mocha and SJM.

A spokeswoman for Melco International Development said the development still needed the Macau government's approval. ``There is not any confirmed construction contract,'' she said.

Skynet is 94 per cent owned by Paul Y-ITC, the largest listed builder in the territory. Earlier this year, Paul Y-ITC injected the construction unit and shareholder loans of a subsidiary into Skynet.

Macau gambling kingpin Stanley Ho Hung-sun yesterday opened his first major new casino since losing his monopoly - but admitted he was struggling to find staff.

In a move to cash in on the "golden week" holiday - with thousands of mainland gamblers expected to jam gaming tables - Mr Ho opened the Casa Real Casino as part of a newly renovated four-star hotel of the same name.

But the tycoon expressed serious fears about finding enough capable employees.

"Our hotels and casinos are all short of staff. We've already lowered prerequisites to the minimum possible, and still we haven't found enough people," Mr Ho said.

"Macau is developing so fast that supporting elements, especially labour, are fundamentally lagging behind."

Some fear the labour shortage problem has the potential to throw a spanner in the works of the casino boom. Macau Chief Executive Edmund Ho Hau-wah has set up a special committee, which he heads, with representatives from the hospitality and casino industry, government officials and academics to study the issue and find a solution.

Within 15 minutes of opening, the three casino floors of the Casa Real were busy and filled with cigarette smoke.

It is located at the former Nam Yue Hotel, has 126 slot machines and 73 gaming tables, including 20 tables in six VIP suites.

But one tourist was not impressed by Mr Ho's latest casino venture.

"This is mediocre," said Hong Hui, from Dongguan, pointing to the gold -coloured pillars, marble floors and Mediterranean paintings in the main gaming floor.

"It looks ornate, but it also looks artificial. What does all this have to do with Macau?"

Mr Ho will open three more casinos by the first quarter of next year: at the Hotel Fortuna, Hotel Presidente and Plaza Hua Iung.

The battle among Macau's casino operators started in May when the Las Vegas Venetian company unveiled the Sands.

The American casino has proved to be a sensation, welcoming 1 million visitors a month.

The Sands has chipped away an estimated half of the punters that would have gone to Mr Ho's casinos, local observers say.

Mr Ho has responded to the competition by gradually renovating the Lisboa.

Work has also started on a large resort-casino next to the Lisboa.

Mr Ho also faces competition from the Hong Kong-owned Galaxy, which in July opened its first casino-hotel, the Waldo, catering mainly to high rollers.

Meanwhile, Las Vegas-headquartered Wynn Resorts, another holder of one of Macau's coveted gaming licences, has begun construction on its own large resort-casino directly across from the Lisboa.

It is projected for completion by the end of 2006.

A threatened labor shortage in the booming gambling city of Macau became a reality last weekend when a new casino opened its doors for business even though it was short of skilled staff.

One of the latest gaming center, opened on Saturday without its full complement of croupiers. 'Macau is developing so fast that supporting elements, especially labor, are lagging behind.'

Ever since foreign companies were allowed to pitch for a share of the city's century-old casino market, economists have warned that the tiny southern Chinese enclave would not have enough skilled workers to staff the more than 20 casinos that were planned.

Monthly turnover in Macau's casino market has mushroomed to US$512 million (S$860 million) over the past year, largely as a result of a surge in the number of tourists from mainland China.

MACAU – As reported by the China Standard: "Skynet (International Group) Holdings, a construction arm of builder Paul Y-ITC Construction, is in talks to build a hotel-casino complex in Macau for tycoon Stanley Ho that is reportedly worth HK$1.3 billion (US$166.7 million).

"Paul Y-ITC's deputy managing director Billy Wong confirmed the company was in talks on a contract to build a hotel but declined to disclose the contract size and the hotel's owner. `The negotiation has yet to be confirmed,' he said. `I suppose we are not the only contractor in the negotiation.'

"…According to a Hong Kong Economic Journal report on Monday, the contract covers construction of a six-star hotel and a casino. The hotel, comprising about 400 guestrooms, would be ready for operation by 2006.

"…The casino would be run by STDM's unit, Sociedade de Jogos de Macau (SJM), and the electronic gaming lounge, by Melco's unit, Mocha Slot Group. The joint venture would receive rental income from Mocha and SJM…"

Macao's casino racked in 500 million patacas (62 million US dollars) in gross revenue in the first three days of the National Day holiday which began on Oct. 1.

Tuesday's Macao Daily News reported that the holiday market has boosted the gaming sector. The accumulated gross revenues and taxes yielded by the gaming sector in the first nine months this year have surpassed the total amounts of last year.

For the whole of last year, the government collected 10.17 billion patacas (1.27 billion US dollars) in gaming taxes.

The newspapers source said that the gaming revenue in September amounted to 3 billion patacas (375 million US dollars), which were some one billion patacas (125 million US dollars) lower than the monthly income in the previous two months.

The newspaper said that the Macao Gaming Co. Ltd. owned by tycoon Stanley Ho held 67 percent of the market share in September, during which Macao's first American casino the Las Vegas Sands Macao opened in May grasped 13.5 percent, and the Hong Kong-invested Galaxy Waldo inaugurated in July obtained 19.5 percent.

Industry insiders forecast that based on the current situation,the gaming sector would contribute 13 billion patacas (1.2 billionUS dollars) to the government's tax coffer this year.

I wonder if Gambling and Casinos are going to legalized in China in near future. Stupid Chinese government.

Actually, legalized gambling is a very contentious issue even in the West. Many countries do not allow their residents to gamble in the casinos at home. They cater to tourists only. For example, Macau's casinos are not open to locals.

Mainland Chinese like to travel abroad to gamble. They key places I can think of right now are Macau and Genting in Malaysia (and perhaps Walker Hill in Seoul).

Wynn Resorts' merits stretch far beyond Wynn Las Vegas. Fool contributor Jeff Hwang thinks the company will be a hit -- but that doesn't necessarily mean that the stock is at this price.

By Jeff Hwang
October 11, 2004

Last week, fellow Fool contributor Lawrence Meyers gave his take on Wynn Resorts (Nasdaq: WYNN) (see "Quick Draw on Wynn Resorts"). Basically, Lawrence suggested that for an investor to try to justify Wynn's $4.75 billion market cap at this point may be more akin to gambling, as the company isn't expected to even begin to produce real revenue until its Wynn Las Vegas super resort on the Las Vegas Strip debuts in April 2005.

First off, I'd like to stress that the gist of Lawrence's message is spot on: The value-driven investor should be wary of this type of situation. However, I think I should also point out that Wynn Resorts' merits stretch far beyond Wynn Las Vegas.

The Macau dream
In 2006, Wynn will open Wynn Resorts Macau in the explosive growth gaming market of Macau, the former Portuguese colony a mere couple dozen miles west of Hong Kong. Wynn will become the second U.S.-based company to operate there; Las Vegas Sands -- owner of the Venetian on the Vegas Strip -- became the first this past May when it opened Sands Macau.

Last week, Wynn Resorts gave a presentation at the Goldman Sachs and Deutsche Bank Securities Gaming Investment Forum, which you can access from Wynn Resorts' website by clicking here. Here are some of the key figures:

In 2003, the Las Vegas Strip and Atlantic City markets reported gaming revenues of $4.8 billion and $4.5 billion, respectively. For 2004, the Macau gaming market is expected to grow to a whopping $5.2 billion from just $3.5 billion last year.
There are 100 million people within a three-hour drive of Macau, and 1 billion people within a three-hour flight.
Mainland China is now Macau's No. 1 source of visitors, outnumbering Hong Kong. In 1991, Hong Kong accounted for over 80% of Macau's visitors.
The Macau market is clearly expanding, and there is plenty of reason to think Wynn will have success. In its $350 million IPO filing last month, Las Vegas Sands reported that through the two months ending July 31, the Sands Macau casino raked in $36.9 million in earnings and EBITDA (earnings before interest, taxes, depreciation, and amortization) of $41.2 million -- not bad considering the cost of the project was a mere $240 million.

It doesn't hurt that the property plays host to a million visitors a month, either.

Sub-concessions and cross-marketing
The business growth aspirations are stellar as well. Sands intends to build something of a casino Disney (NYSE: DIS) World on Macau, with a new Venetian casino as the centerpiece. Further, the concession given to the company by Macau will allow it to sell sub-concessions to third-party casino operators to help complete the fantasy world, all the while paying Sands a fee -- perhaps a tax on revenues -- for the right to the sub-concession.

Wynn Resorts expects to garner further profits via its own sub-concession rights in a similar manner. In addition, both Las Vegas Sands and Wynn Resorts will be able to take the high-rolling gamblers they acquire in Macau and bring them to their resorts in Las Vegas, creating superior cross-marketing value.

Given those ramifications, it's not hard to see why Strip giant MGM Mirage (NYSE: MGG) -- just days after announcing its intent to merge with Mandalay Resort Group (NYSE: MBG) -- was so excited to land its own bid on Macau this past summer via partnership with Pansy Ho Chiu-king, daughter of Macau gaming mogul Stanley Ho (see "MGM Mirage Hits Macau").

Back to Wynn Las Vegas
And of course, Wynn Las Vegas itself is still a big piece of the puzzle.

Wynn Las Vegas sits on 217 acres, and will mark the north end of the modern generation of Strip hotels just past the Venetian and the site of Las Vegas Sands' next major casino project. The multibillion-dollar project will feature an 18-hole golf course, a Ferrari and Maserati car dealership, 2,716 hotel rooms, and 74,700 square feet of retail space connected to the 2-million-square-foot Fashion Mall across the street.

As the company happily points out in its presentation, Steve Wynn trumped Caesars (NYSE: CZR) Palace with the Mirage, and then trumped the Mirage by building the masterpiece that is Bellagio. Next spring, Wynn plans on trumping Bellagio with Wynn Las Vegas, and the whole world expects him to do it.

Speculation: when a hit is not a hit
There is little doubt in my mind that Wynn Resorts is a hit. But for the investor, that is certainly not the end of the story.

As Lawrence pointed out, there is a lot of speculation involved here. It's not all that different from the speculation involved in buying Google (Nasdaq: GOOG) at the IPO, or from the speculation involved, say, when gamblers add $1 billion to the market value of a cash-bleeding company because Howard Stern signs with Sirius Satellite Radio (Nasdaq: SIRI) (see "Billion-Dollar Sex Joke" and "Sirius and Stern").

It's not necessarily wrong or right; anyone who has ever followed The Motley Fool's Rule Breaker portfolio -- or has a subscription to David Gardner's new Rule Breakers newsletter -- knows that we've done our fair share. We just highly recommend that you keep valuation as the core consideration.

If you have any interest in buying shares of Wynn Resorts, it is vital to your long-term investing success that you at least come up with some ballpark assumption of fair value. Take into consideration all of the factors we've discussed here, as well as the valuations of comparable companies and other stocks you are interested in. And once you've done that, buy with a margin of safety by making sure you are getting a large discount to fair value, keeping in mind that the more speculative the investment, the bigger the margin of safety you require.

If you have no idea of fair value or you find that the stock's current price offers no margin of error, then just don't buy. Because if you choose to ignore valuation and pay the wrong price, there is a much better chance that what may be a hit for Wynn Resorts will turn out to be a bust for you.

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CARSON CITY -- Las Vegas Sands Inc., which owns the Venetian and is building the 3,000-room Palazzo on the Las Vegas Strip, has received final approval from the Nevada Gaming Commission to sell up to $575 million in common stock.

The public offering must still win approval from the federal Securities and Exchange Commission.

Greg Giordano, attorney for the Sands, told the commission Thursday he hoped the sale could be completed in December and the money will go toward expansion in such gaming markets at the United Kingdom and Asia.

The Venetian, led by Sheldon Adelson, is building a second casino with 118,000 square feet of gaming space and completion is expected 2007. While the Sands will build it, the Palazzo project will be leased and owned by another company, said Rob Goldstein, president of the Venetian.

The commission also questioned Sands executives about its gaming casinos in Macau that opened this year. Gary Saunders said the casino is still catering to the mass market and is moving slowly into attracting high-end gamblers.

Saunders said credit is given at the casino in Macau only to those who have established it at the Venetian.

In other action, the commission granted an unlimited license to Albert D. Seeno III to be a 5.1 percent beneficiary in the trusts of Albert and Sandra Seeno, who are part owners of the Peppermill in Reno, Western Village in Sparks and the Rainbow Club in Henderson. The license also allows him to be a 10.3 percent beneficiary in the trust that holds an interest in two clubs in Wendover.

Other non-restricted applications approved included William J. Allison to contract with New York-New York in Las Vegas, and Sheldon Adelson to put 16 percent of his stock in the Venetian in Las Vegas into a trust for family.

The commission also approved applications for the following companies to make public offerings: Shuffle Master, Inc., American Casino & Entertainment Properties LLC and Herbst Gaming.

The commission approved PDS Holding Co., a company that specializes in financing for leasing gaming equipment, to convert from a publicly traded company to a private company. It granted a license to Harold Holder for slot machines at the Wigwam Casino in Fernley.

The commission also approved tax refunds of $79,000 to the Palms Casino Resort and $99,000 to the Rampart Casino.

Macau gambling tycoon Stanley Ho said he may sell his privately held business to Melco International Development Ltd., Hong Kong's South China Morning Post reported.

Ho, speaking after Melco's annual shareholders meeting, said Melco would become his listed gambling flagship in the event the asset transfer occurs, according to the paper. Ho is chairman of Melco, which is run by his son, Lawrence.

Shun Tak Holdings Ltd., also controlled by Ho, previously said it doesn't plan to increase its 11 percent stake in the tycoon's casino-owning Sociedade de Turismo e Diversoes de Macau and will instead focus on nongambling business, the Post said.

In a statement, Melco said its independent shareholders approved an agreement with Sociedade de Turismo for the joint development of a casino and hotel in Macau.

The rally of Macau-related stocks has been heating up, as investors expect firms with investment exposure or plans for the SAR to benefit from its liberalised gambling business.

Far East Tech International and Far East Hotels and Entertainment were the top gainers on Hong Kong's stock market on Wednesday, skyrocketing 140 per cent and 90 per cent respectively.

Far East Consortium, which controls both units, plans to develop a multi-purpose project including hotels, apartment complex and shopping mall in Macau that cost HK$1.7 billion, a JPMorgan report said.

Shares of Far East Consortium rose 13 per cent on Tuesday, while Melco International Development and Century Legend Holdings, both investors in Macau's gaming industry, leapt at least 10 per cent, compared with a 0.67 per cent gain in the Hang Seng Index.

``There's no other appealing stories in the stock market other than the hot theme of Macau gaming industry,'' RexCapital executive director Alex Wong said.

The gambling industry, estimated to account for more than 40 per cent of Macau's gross domestic product, is expected to enjoy a further boom after new casino operators Las Vegas Sands and Galaxy Resort and Casino opened business this year.

The new casinos have brought an influx of mainland tourists to the city. Macau's visitor arrivals were up 31 per cent in September from a year ago to 1.31 million.

Kenny Tang, associate director of Tung Tai Securities, said investors were bullish on the Macau gaming industry and its economy. Investors were speculating that if any listed firms like Melco could transform to a Macau gambling or related play, their values would soar.

Shares of Melco, in which chairman Stanley Ho said he may inject more gambling assets, have jumped 460 per cent this year, while the share price of Shun Tak Holdings, which plans to spend HK$1 billion on a hotel and property project, has doubled. Far East Consortium's shares are up 80 per cent this year. K.Wah International, whose chairman Lui Che-woo controls Galaxy, and Century Holdings have both seen their shares gain 30 per cent.

Citigroup's Smith Barney unit in mid-October started covering Melco shares with a ``buy'' rating and a share-price estimate of HK$12.10 after Melco sought HK$377 million in a share sale to help fund a Macau hotel-casino project and to expand the company's slot-machine business.

``Melco could emerge as the only listed vehicle that provides direct exposure to the rapidly developing casino market in Macau,'' Smith Barney said.

RexCapital's Wong said the coverage and recommendation from some big brokerages also helped fuel the Macau stocks rally. ``If there's no such research reports to cover Melco, its share price cannot fly high without the push from institutional investors,'' he said. ``Macau-related stocks, except for Melco, only have the gaming assets injection concept without solid or clear business models, so valuing such stocks is difficult and investing in them is just like gambling.''

Galaxy Waldo
http://img28.exs.cx/img28/6171/171164585pBewjE_ph.jpg

http://img59.exs.cx/img59/4861/102584565gBXdDv_ph.jpg

Macau, Nov. 7 (CNA) Macau casino godfather Dr. Stanley Ho said Saturday that he would be very interested in opening a casino/hotel on Taiwan's Penghu Island if the government gives a green light to such business. During an interview with Taiwan media Saturday, Ho, a Hong Konger who owns a business empire in Macau and Hong Kong, principally involved in gambling, said his company, Melco International Development, would be glad to invest in Penghu if casino operations are permitted there. Ho said that he has been to Penghu and came away with a strong impression of the scenic environment there. If Macau is given the chance, his company might channel investment to the tune of HK$15 billion (US$1.9 billion) into Penghu to build a casino kingdom there, he said. (By C.H. Jen and Deborah Kuo) ENDITEM

MACAU, China -- Glittery Las Vegas gambling has arrived in seedy Macau, promising new charms for China's inveterate players, and this former Portuguese colony may never be the same.

The first Las Vegas invasion, the Sands, has risen bronze-tinted and modernistic on the edge of Macau's little harbor, where fast ferries from Hong Kong deliver thousands of gamblers every day. With more than 300 tables and 500 slot machines in 165,000 square feet of luxury casino, the sleek new entry scooped up almost $36 million in the first 10 weeks after it opened in mid-May.

Venetian Macau Ltd., the Las Vegas Sands Inc., subsidiary that built the Sands, has started construction on a second high-end casino near Macau International Airport. Wynn Resorts, another Las Vegas firm elbowing into Macau gambling, has launched two similarly grandiose projects, one of which includes a golf course along with its 110,000-square-foot casino.

The competition from Las Vegas has pushed the traditional Macau gambling empire, created by the legendary Stanley Ho, to refurbish frayed facilities and erect new ones.

At the same time, Galaxy, a Hong Kong-owned firm that initially partnered with Venetian and then split off, has broken ground on a casino described by the government's Tourism Office as "a large-scale resort and entertainment center." It has also announced plans for a new 600-room establishment in the crowded city center.

The new construction is only part of the picture. The deepest changes may be in the personality of this 10.5-square-mile territory on the South China Sea, which has a long tradition of laissez faire, allowing prostitutes, loan sharks and gangsters to prosper alongside the croupiers. But the Las Vegas gaming industry has made it clear it intends to market gambling in Macau as wholesome entertainment.

"Macau can no longer be just a gambling den," said an industry source aware of marketing strategies. The Las Vegas gambling companies, the source added, "are bringing a sense of entertainment for the family as well as the man."

Ho's Macau Gaming Co., which grew up in Macau's smoky tradition and helped it grow, has also begun seeking a broader clientele.

"The focus has been widened from that of economic stimulus and spinoff benefits for social and infrastructure projects to the wish to improve Macau's international image," said a statement issued in response to questions put to the office of Ambrose So, Macau Gaming Co.'s director, about the arrival of Las Vegas-style casinos.

Macau has undergone several changes since it reverted to Chinese control in 1999, including the granting of new licenses into a formerly closed gambling market. But none has been as far-reaching as this challenge to the anything-goes credo that has made Macau notorious.

"It's going to change our way of life," predicted the Rev. Lancelot M. Rodrigues, who arrived in Macau to study for the priesthood in 1935 and has watched the territory evolve ever since with benign cynicism.

As things stand, no one seems to care when Schubert's "Ave Maria" segues into "Unchained Melody" in the music for sidewalk diners enjoying Portuguese cuisine in Macau's tepid evening air. Those drinking vinho verde and eating the ersatz Portuguese fish stew coexist just as easily with neighbors slurping Chinese noodles across the alley.

Traditionally, gamblers of all kinds find a warm welcome. Macau's homegrown casinos cater with indiscriminate zeal to Hong Kong high rollers who fly in by helicopter to bet millions in VIP rooms and to crowds of bused-in Chinese who fritter away their salaries chip by chip a few stories below.

The do-as-you-like jumble has proved an irresistible draw for people from mainland China, where casinos are illegal. By the millions -- 11.8 million in 2003 -- they have poured into Macau since the turnover to China, aided by increasingly lax border controls.

Mao Hang, a court reporter who came with a tour group from his native Anhui province in eastern China, tried his luck last week at the Lisboa, one of Ho's premier properties now undergoing a facelift by painters scaling bamboo scaffolding. For him the experience, his first shot at the tables, was exhilarating.

"It's a lot of fun," he said. "But it really is nerve-racking."

Another group of stylelessly dressed men from Gansu province in western China, stickers on their lapels identifying them as group tourists, laughed nervously when asked whether they enjoyed their try at gambling. One pointed mischievously at his friends and said: "I only like to watch. But they love to gamble."

Chiefly because of visitors like Mao and the others, the amount of taxes paid by Macau's 15 operating casinos rose more than 50 percent in the first eight months of this year, according to Macau government statistics. These taxes -- which account for 70 percent of government revenue -- when combined with the construction boom helped generate second-quarter economic growth of 47 percent.

Although most Chinese visit on bus tours, officials sometimes pull up in limousines and bet embezzled public money. Wuhua Li, the public security chief of Huizhou in neighboring Guangdong province, was removed from his post last month and put under investigation on charges he gambled away more than $1 million obtained by extorting money from Chinese women seeking passage into Hong Kong, the controlled Chinese press reported.

The question for the Macau gambling industry is whether the new concepts and new level of luxury being introduced by Las Vegas gambling firms will appeal to Chinese visitors. Executives have predicted they can also draw visitors from elsewhere in Asia with opulence, conventions and golfing. But China, with its 1.3 billion inhabitants, has remained the main target.

Ambrose So, the director of Ho's company, said he believes Macau's traditional casinos should learn from the Las Vegas entrants but also stick to the territory's own traditions. "The Las Vegas model is unique because of its geographical, historical and sociocultural characteristics, from which Macau is totally different," he said.

Ho, the 84-year-old gambling patriarch, has not spoken much in public of the end to his long-held monopoly. At the opening of the Sands on May 18, he proclaimed himself ready to learn from his rivals. Hong Kong's South China Morning Post reported that at a Macau Gaming Co. function in September, he vowed, "We are Chinese and we will not be disgraced. We will not lose to the intruders."

http://media.washingtonpost.com/wp-dyn/images/I35510-2004Nov08
A woman places a bet at the Lisboa in Macau. The industry is being transformed by Las Vegas-based resorts.

MACAU – As reported by the China Standard: "Cruise ship operator Macau Success has teamed up with casino tycoon Stanley Ho's Sociedade de Jogos de Macau (SJM) to build a HK$1.2 billion (US$154.4 million) theme park in Macau's Inner Harbour area.

"The park, Ponte 16, will be built on a 23,066-square-metre site with potential gross floor area of 63,584 sqm.

"It will feature a 250-room hotel, a casino with more than 100 gambling tables to be run by SJM, a 25,833 sqm shopping arcade, a cultural space and car parks. Construction is expected to begin next year and be completed by the end of 2006.

"Macau Success will boost its stake in a joint-venture property development company to 24.5 per cent from 10 per cent and set aside about HK$300 million for Ponte 16, executive director Marco Lee said…"

Macau Success Ltd., a Hong Kong retailer that's shifting its focus to Macau, will take a 24.5 percent stake in a planned HK$1.2 billion ($154.3 million) themed hotel and casino in the former Portuguese enclave. Its stock surged by as much as two-thirds.

The Ponte 16 development, of which Macau gambling tycoon Stanley Ho's Sociedade de Jogos de Macau will hold 51 percent, will include a 250-room hotel, casino, shops and "cultural area" done in the local early-20th century architectural style, Macau Success said in a Hong Kong stock exchange statement.

Macau's economy expanded 17 percent in 2003, in part because of a surge in hotel and casino construction after the city ended Ho's monopoly in 2002. Growth probably accelerated after China made it easier for mainland residents to visit Macau, the only place in China where casino gambling is legal.

Injection of casino project spurs new placement.



Deutsche Bank completed a HK$405.8 million ($52 million) placement in Macau Success yesterday (November 11). The 317 million new share deal was priced at HK$1.28, representing a 9.8% discount to the stock's HK$1.42 close on Wednesday after which it was suspended. The deal had initially been marketed at a 7% to 18% discount.

Macau Success was suspended for all of last week and re-opened trading this Tuesday, jumping from HK$0.95 to HK$1.50 in the space of a day. The huge jump was prompted by news that the group had increased and injected its stake in a Macau joint-venture.

Macau Success purchased a further 14.5% interest in a HK$1.2 billion ($153 million) entertainment complex known as Ponte 16 for HK$1.4 million. The group is developing a hotel, casino and shopping mall in association with Stanley Ho's Sociedade de Jogos de Macau. The latter, Macau's richest man, owns 51% of the JV, while Macau Success will now own 24.5% and Joy Idea the remaining 24.5%.

The placement will increase the freefloat by 20% to 38%. Other major shareholders include Silver Rich Investments, which owned 40% pre deal and Spring Wise Investments, which owned 16%.

Observers say the order book closed six times covered, with participation by 70 accounts. Many had already been buying the stock when it had resumed trading on Tuesday and Wednesday. By geography, 25% went to Europe, 20% to offshore US and the remaining 55% to Asia.

At the placement price, the company is said to be valued at about five to six times 2006 earnings. This year is being used since the project will not on stream until then. The only other major comparable is Stanley Ho's own listed group, Melco International Development, which is also trading at the same P/E level, though on a 2005 basis.

The tycoon caused controversy last week when he appeared to indicate he would turn Melco into the flagship of his gaming empire. This has since been retracted, with the share price slipping from a high of HK$11.4 to HK$8.80 at the time Macau Success priced.

So far this year, Macau concept stocks have performed well, with Melco up 448% and Far Eastern Hotels up 68%.

Wynn Resorts Ltd., the casino company behind developer Steve Wynn's $2.5 billion Wynn Las Vegas megaresort on the Strip, will raise $453 million by selling 7.5 million common stock shares to Deutsche Bank Securities, the company said Tuesday.

The sale of 7.5 million shares at $60.43 each to Deutsche Bank is expected to close Monday, Wynn Resorts said in a statement. Deutsche Bank has the option to purchase an additional 1.125 million shares.

The proceeds will help fund expansion of Wynn Las Vegas and a casino being built in the Chinese territory of Macau, the company said. The $900 million expansion, which Wynn expects to open in 2007, will include a 1,500-suite hotel tower and more casino space. The first phase of the project, which includes 2,700 rooms, is slated to open April 28.

News of the offering prompted a downgrade Tuesday from Banc of America Securities analyst Jeremy Cogan. Cogan dropped Wynn Resorts' stock rating to "neutral" from "buy." The stock fell 5.08 percent after the downgrade. Wynn Resorts has about 90.5 million shares outstanding so the offering would dilute the company's common stock by 8 percent.

"We remain fans of the Wynn story," Cogan wrote in a research note highlighted by TheStreet.com. "We continue to believe Wynn is in the cross hairs of three of the strongest themes in gaming (i.e., significant growth opportunities in Macau, strong Las Vegas fundamentals, and the recent speculation on land values on the Strip.) Even so, at current levels we think most of the good news is discounted."

The analyst noted that Wynn's stock has risen more than 80 percent since mid-August. On Tuesday, shares of Wynn Resorts at one point dropped by as much as $4.22 before rallying. The shares closed down $3.26 to $60.93. Deutsche Bank Securities is the investment banking unit of Frankfurt-based Deutsche Bank AG.

MACAU, CHINA -- Glittery Las Vegas gambling has arrived in seedy Macau, promising new charms for China's inveterate players, and this former Portuguese colony may never be the same.

The first Las Vegas invasion, the Sands, has risen bronze-tinted and modernistic on the edge of Macau's little harbor, where fast ferries from Hong Kong deliver thousands of gamblers every day. With more than 300 tables and 500 slot machines in 165,000 square feet of luxury casino, the sleek new entry scooped up almost $36 million in its first 10 weeks in mid-May.

Venetian Macau Ltd., the Las Vegas Sands Inc. subsidiary that built the Sands, has started building a second high-end casino near Macau International Airport.

Wynn Resorts, another Las Vegas firm elbowing into Macau gambling, has launched two similarly grandiose projects, one of which includes a golf course along with its 110,000-square-foot casino.

The competition from Las Vegas has pushed the traditional Macau gambling empire, created by the legendary Stanley Ho, to refurbish frayed facilities and erect new ones.

At the same time, Galaxy, a Hong Kong-owned firm that initially partnered with Venetian and then split off, has broken ground on a casino described by the government's Tourism Office as "a large-scale resort and entertainment center." It has also announced plans for a new 600-room establishment in the crowded city center.

The construction is only part of the picture. The deepest changes may be in the personality of this 10.5-square-mile territory on the South China Sea that has a long tradition of laissez faire, allowing prostitutes, loan sharks and gangsters to prosper alongside the croupiers. But the Las Vegas gambling industry has made it clear it intends to market gambling in Macau as wholesome entertainment.

"Macau can no longer be just a gambling den," said an industry source aware of marketing strategies. The Las Vegas gambling companies, the source added, "are bringing a sense of entertainment for the family, as well as the man."

Ho's Macau Gaming Co., which grew up in Macau's smoky tradition and helped it grow, has also begun seeking a broader clientele.

"The focus has been widened from that of economic stimulus and spinoff benefits for social and infrastructure projects to the wish to improve Macau's international image," said a statement issued in response to questions put to the office of Ambrose So, Macau Gaming Co.'s director, about the arrival of Las Vegas-style casinos.

Anything goes

Macau has undergone several changes since it reverted to Chinese control in 1999, including the granting of new licenses into a formerly closed gambling market. But none has been as far-reaching as this challenge to the anything-goes credo that has made Macau notorious.

"It's going to change our way of life," predicted the Rev. Lancelot Rodrigues, who arrived in Macau to study for the priesthood in 1935 and has watched with benign cynicism as the territory evolved.

Traditionally, gamblers of all kinds find a warm welcome. Macau's homegrown casinos cater with indiscriminate zeal to Hong Kong high rollers who fly in by helicopter to bet millions in VIP rooms and to crowds of bused-in Chinese who fritter away their salaries chip by chip a few stories below.

The do-as-you-like jumble has proved an irresistible draw for people from mainland China, where casinos are illegal. By the millions -- 11.8 million in 2003 -- they have poured into Macau since the turnover to China, aided by increasingly lax border controls.

The question for the Macau gambling industry is whether the new concepts and new level of luxury being introduced by Las Vegas gambling firms will appeal to Chinese visitors. Executives have predicted they can also draw visitors from elsewhere in Asia with opulence, conventions and golfing. But China, with its 1.3 billion inhabitants, has remained the main target.

Ambrose So, the director of Ho's company, said he believes Macau's traditional casinos should learn from the Las Vegas entrants but also stick to the territory's own traditions. "The Las Vegas model is unique because of its geographical, historical and sociocultural characteristics, from which Macau is totally different," he said.

Ho, the 84-year-old gambling patriarch, has not spoken much in public of the end to his long-held monopoly. At the opening of the Sands on May 18, he proclaimed himself ready to learn from his rivals. Hong Kong's South China Morning Post reported that at a Macau Gaming Co. function in September, he vowed, "We are Chinese and we will not be disgraced. We will not lose to the intruders."

ELEANOR HALL: Australia's most famous punter is making a push into the fast growing and lucrative Asian gaming industry.

Kerry Packer's media and casino company PBL has signed a joint venture deal with a leading Asian casino operator to build a gambling and hotel complex on the island of Macau, near Hong Kong.

It's the Packers' first foray into Asia, and will add considerably to the company's casino interests when it's up and running in 2007.

To tell us more, I'm joined by Finance Correspondent Karen Percy.

So Karen, what exactly will this deal mean for Kerry Packer and PBL?

KAREN PERCY: Well, it certainly is a very significant first step into the Asian gaming industry. Firstly, he's teaming up with one of the biggest players in the Asian casino market – Stanley Ho. He runs a company called Melco, and one of the oldest and most established firms in Hong Kong.

This is a 50-50 joint venture. Now, essentially PBL is going to invest some AUS$211 million to be part of Melco's Asian casino developments. The first project is the Park Hyatt Hotel and Casino in Macao. It's set to begin construction next month. By the time that's built and ready to roll in 2007, PBL will own about 28 per cent, or thereabouts, in this six star establishment.

Now, it's also going to have 200 gaming tables, 250 hotel rooms and suites, 1,300 gaming machines… and you may not know it, but Macao at the moment is just about the hottest gambling spot on the planet.

It has 15 casinos, and when you look at Las Vegas, Las Vegas certainly has a lot more of that, but they're certainly calling this the Las Vegas of the east, because turnover in the past financial year in this former Portugese colony was almost four-and-a-half billion US dollars – that's about 5.7 billion dollars Australian. And that's pretty significant, considering it's really only been in the past four years that it's taken off.

The Packers had been sniffing around for Macao for a while. There was a story out a couple of months ago where James Packer was spotted at one of the other casinos in Macao with Stanley Ho not too far behind.

So it's something that they've been interested in doing for some time, but from what I can gather you actually have to have a local partner for foreign firms to get into this industry.

ELEANOR HALL: So clearly a market worth looking at. Is this likely to be just the first stage of a plan by the Packers to expand into Asia?

KAREN PERCY: Well, the most interesting part of this deal, really, is because this $211 million isn't really a lot to pay for that kind of casino, considering the Packers paid $670 million for the Burswood Casino in Perth, which had last year profits of about $50 million.

So it means significantly that the Asia deals that are likely to come from this are most significant for PBL, because Asia's of course one of the fastest growing gambling markets, the rapid rise in the number of wealthy Asians certainly spurring demand, particularly for high-end facilities.

But the joint venture's going to mean PBL has a 40 per cent stake in any other developments in the greater China region. As yet there's nothing specific on the horizon, but you've got to figure that the potential's pretty lucrative, especially over the long term.

As well, PBL's going to have a 60 per cent stake in any joint venture projects elsewhere in Asia.

Now Melco – this is the PBL partner – it's not just one of the oldest firms in Hong Kong, it's one of the most influential. It used to be the Macao Electrical and Lighting Company. It's gone well beyond being a utility now.

It's in the restaurant business. We might have heard of the famous Jumbo floating restaurant in Hong Kong. It's also offering financial services in Hong Kong, so it’s a really diverse company, and one that will no doubt be a very valuable partner for PBL and the Packers as they look northwards.

ELEANOR HALL: Well, PBL is also known as a media company, of course. How does this fit in with PBL's domestic operations?

KAREN PERCY: Well, it's… definitely the publishing and broadcasting side of PBL is certainly starting to be the lesser of the company's earners. Even before it completed the Burswood purchase earlier this year, just a month ago or thereabouts, gaming and gambling was making up close to 40 per cent of its revenues – that was the Crown Casino alone.

So I imagine that this is going to fit in pretty well, because casinos rely heavily on those high rollers who are prepared to travel near and far for their experience, so it'll be a natural tie-up, you'd think, for those high rollers in Macao to link into the Crown Casino or the Burswood Casino.

So the Packers are also looking online. They've got a deal with the UK-based internet firm, Betfair, should Australian authorities ever approve online betting.

So it's definitely an area that has great interest. We know Kerry Packer's a big punter himself, and it's something that the business is pushing for as well.

ELEANOR HALL: Karen Percy, our finance reporter, thank you.

The owner of the Venetian is facing another lawsuit related to the company's lucrative casino in the Chinese enclave of Macau.

Last month, Hong Kong businessman Richard Suen sued Las Vegas Sands Inc., Chief Executive Sheldon Adelson and President William Weidner in Clark County District Court for breach of contract.

In his suit, Suen claims he notified Las Vegas Sands officials in 2000 about the Macau government's intentions to grant new casino licenses through a competitive bid process.

Around September 2001, Suen and his Hong Kong company, Round Square Co. Ltd., accepted a written offer from the Sands to receive a $5 million "success fee" upon opening of a resort and 2 percent ownership of the Sands' share of the resort's net profit, the suit said. Suen is seeking more than $100 million in damages based on the Sands Macau's earnings so far.

Suen and his company introduced Sands executives to government officials and other influential people, advised the company on preparing their bid, analyzed strategies for selecting investment partners and advised the company on compliance procedures in China and Macau, among other things, the suit said. That assistance was a "substantial factor" in the Sands' winning bid, it said.

In its third quarter financial statement filed with the Securities and Exchange Commission Monday, Las Vegas Sands said it would "vigorously" contest the suit in court.

Last December, an Israeli tourism entrepreneur filed a breach of contract suit in Tel Aviv against Adelson. In the suit, Moshe Hananel accuses the casino boss and his Interface Partners International Ltd. subsidiary of violating an agreement to grant Hananel options for 12 percent of Adelson's holdings in his Macau project. The suit said the options were granted in exchange for drafting the licensing plan. Hananel said his work on the Macau development "gave Mr. Adelson a huge advantage over other entrepreneurs who saw the opportunity at a later stage."

Adelson countersued, accusing Hananel of misappropriating funds while working at Interface.

Hananel could not be reached for comment to determine the status of their claims and Sands Chief Financial Officer Scott Henry declined comment, citing an SEC-imposed "quiet period" while the company awaits an initial public offering of stock.

In 2002, the Macau government ended a decades-old casino monopoly in the former Portuguese colony by granting casino licenses to Galaxy Casino Co. Ltd. and Adelson rival Steve Wynn. The Las Vegas Sands opened its Sands Macau casino in May under a subconcession agreement with Galaxy and also plans to open a Macau version of its Venetian resort in 2007. Wynn's Wynn Macau subsidiary is developing a resort in the province and MGM Mirage, in a joint venture with Macau casino boss Stanley Ho's daughter, also plans a resort there.

Separately, the company disclosed a separate lawsuit filed by Bear Stearns Funding Inc. against Interface Nevada, a Las Vegas Sands subsidiary. Bear Stearns seeks damages of $1.5 million, plus interest and costs, over an alleged breach of contract in connection with a $141 million mortgage loan that was paid off in July. Interface Nevada has asserted six counterclaims against Bear Stearns "in an amount to be determined at trial." Officials with the Bear Stearns investment bank and Las Vegas Sands could not be reached for further information on the suit.

AUSTRALIA'S richest man and ardent gambler Kerry Packer is investing $163m (£88.6m) in a venture in Macau with Hong Kong gaming kingpin Stanley Ho as part of Packer's increasing worldwide push in the industry.

His Australian firm, Publishing and Broadcasting Limited (PBL), will establish a 50-50 joint-venture with Ho's Melco International Development and use the operation as a springboard into the mainland.

PBL owns Australia's top-ratings Nine Network, and casinos in Melbourne and Perth along with a stable of magazines.

Packer has long sought an interest in Macau, which he believes drains high-roller business from his Australian operations, particularly Melbourne's Crow, which suffered following the Asian financial crisis of the late 1990s.

The strategy of linking up with an established player tallies with Packer's approach to Britain, where he is working with long-time associate David Aspinall on a £300m push to build casino/entertainment complexes in Scotland and England when gaming laws are liberalised.

Packer and Ho would initially invest in the Park Hyatt Hotel and Casino being developed in Macau, and would also manage and develop the Mocha Slot gaming business, which manages around 25% of slot machines on the island.

Macau is the only legal gambling enclave in China.

Beijing is actively courting foreigners and earlier this year Las Vegas magnate Sheldon Adelson opened the Macau Sands casino.

Macau now has 14 casinos operated by three rival groups, and at least five more are expected to open in the next five years

See more of the world that matters - click here for home delivery of the International Herald Tribune.
< < Back to Start of Article MACAO Publishing & Broadcasting said Tuesday that it had bought a stake in Stanley Ho's latest gambling project in Macao as Asia's two leading casino operators team up to expand in the region.
.
Publishing & Broadcasting, an Australian company controlled by Kerry Packer, said it would pay $163 million for 28 percent of the Park Hyatt hotel and casino development in Macao, owned by the Hong Kong-based Melco International Development, controlled by Ho. The two also plan to expand jointly in China and elsewhere in Asia.
.
Packer has transformed Publishing & Broadcasting, which owns Australia's top-ranked television network, into the country's biggest casino operator with 2.4 billion Australian dollars, or $1.9 billion, of acquisitions since 1999.
.
Ho has linked with Packer to meet competition from Las Vegas operators including Steve Wynn and Sheldon Adelson, after losing his 42-year Macao gaming monopoly in 2002.
.
"It's a significant opportunity" for Publishing & Broadcasting "and a great step in creating a global gaming business," said John Grace, a fund manager at Ausbil Dexia in Sydney. "Macao is becoming as big as Las Vegas and growing strongly."
.
The Sydney-based Publishing & Broadcasting paid 1.8 billion dollars for Melbourne's Crown Casino in 1999, and this year bought Burswood, the owner of Perth's only casino, for 637 million dollars. The two casinos account for 43 percent of the company's revenue.
.
The deal gives Ho access to Publishing & Broadcasting's experience in running resort-style casinos and a client list boasting some of Asia's biggest gamblers.
.
Publishing & Broadcasting says Crown is the world's biggest casino for "high rollers," or gamblers who wager large sums of money. In the 12 months that ended in June, high rollers bet 17.9 billion dollars at Crown, the company said in September.
.
Buying Burswood allowed Packer to attract more high rollers from Asia to Perth, the main Australian city closest to the continent.
.
"PBL, with Crown, Burswood and now Macao, is a more complete offering for a commission-based player," said Grace at Ausbil Dexia. "They can say to high rollers, 'Where would you like to go in our stable; to Burswood, Melbourne or Macao?' It opens up a huge opportunity with one of the biggest players there."
.
Packer and Ho will work together on expansion outside of Macao. Melco will take a 60 percent share of all opportunities in China and Publishing & Broadcasting will own 60 percent of anything in the rest of Asia, outside Australia and New Zealand.
.
Singapore's Ministry of Trade and Industry last month said it might soon ask companies to submit proposals on building a resort that may include the city's first casino.
.
Ho operates 13 of the 15 casinos in Macao. He also owns Macao's horse and dog racing tracks and stakes in its airline and airport as well as real estate, Macao's biggest department store and its second-biggest bank.
.
Macao, which reverted to Chinese rule in 1999, is the closest place for people from China, Taiwan and Hong Kong to gamble legally in casinos.
.
"Total gaming revenue in Macao will this year or next year exceed that of Atlantic City and become the second-largest after Las Vegas," said Winnie Chiu, a property analyst at DBS Vickers Securities HK.
.MACAO Publishing & Broadcasting said Tuesday that it had bought a stake in Stanley Ho's latest gambling project in Macao as Asia's two leading casino operators team up to expand in the region.
.
Publishing & Broadcasting, an Australian company controlled by Kerry Packer, said it would pay $163 million for 28 percent of the Park Hyatt hotel and casino development in Macao, owned by the Hong Kong-based Melco International Development, controlled by Ho. The two also plan to expand jointly in China and elsewhere in Asia.
.
Packer has transformed Publishing & Broadcasting, which owns Australia's top-ranked television network, into the country's biggest casino operator with 2.4 billion Australian dollars, or $1.9 billion, of acquisitions since 1999.
.
Ho has linked with Packer to meet competition from Las Vegas operators including Steve Wynn and Sheldon Adelson, after losing his 42-year Macao gaming monopoly in 2002.
.
"It's a significant opportunity" for Publishing & Broadcasting "and a great step in creating a global gaming business," said John Grace, a fund manager at Ausbil Dexia in Sydney. "Macao is becoming as big as Las Vegas and growing strongly."
.
The Sydney-based Publishing & Broadcasting paid 1.8 billion dollars for Melbourne's Crown Casino in 1999, and this year bought Burswood, the owner of Perth's only casino, for 637 million dollars. The two casinos account for 43 percent of the company's revenue.
.
The deal gives Ho access to Publishing & Broadcasting's experience in running resort-style casinos and a client list boasting some of Asia's biggest gamblers.
.
Publishing & Broadcasting says Crown is the world's biggest casino for "high rollers," or gamblers who wager large sums of money. In the 12 months that ended in June, high rollers bet 17.9 billion dollars at Crown, the company said in September.
.
Buying Burswood allowed Packer to attract more high rollers from Asia to Perth, the main Australian city closest to the continent.
.
"PBL, with Crown, Burswood and now Macao, is a more complete offering for a commission-based player," said Grace at Ausbil Dexia. "They can say to high rollers, 'Where would you like to go in our stable; to Burswood, Melbourne or Macao?' It opens up a huge opportunity with one of the biggest players there."
.
Packer and Ho will work together on expansion outside of Macao. Melco will take a 60 percent share of all opportunities in China and Publishing & Broadcasting will own 60 percent of anything in the rest of Asia, outside Australia and New Zealand.
.
Singapore's Ministry of Trade and Industry last month said it might soon ask companies to submit proposals on building a resort that may include the city's first casino.
.
Ho operates 13 of the 15 casinos in Macao. He also owns Macao's horse and dog racing tracks and stakes in its airline and airport as well as real estate, Macao's biggest department store and its second-biggest bank.
.
Macao, which reverted to Chinese rule in 1999, is the closest place for people from China, Taiwan and Hong Kong to gamble legally in casinos.
.
"Total gaming revenue in Macao will this year or next year exceed that of Atlantic City and become the second-largest after Las Vegas," said Winnie Chiu, a property analyst at DBS Vickers Securities HK.
.MACAO Publishing & Broadcasting said Tuesday that it had bought a stake in Stanley Ho's latest gambling project in Macao as Asia's two leading casino operators team up to expand in the region.
.
Publishing & Broadcasting, an Australian company controlled by Kerry Packer, said it would pay $163 million for 28 percent of the Park Hyatt hotel and casino development in Macao, owned by the Hong Kong-based Melco International Development, controlled by Ho. The two also plan to expand jointly in China and elsewhere in Asia.
.
Packer has transformed Publishing & Broadcasting, which owns Australia's top-ranked television network, into the country's biggest casino operator with 2.4 billion Australian dollars, or $1.9 billion, of acquisitions since 1999.
.
Ho has linked with Packer to meet competition from Las Vegas operators including Steve Wynn and Sheldon Adelson, after losing his 42-year Macao gaming monopoly in 2002.
.
"It's a significant opportunity" for Publishing & Broadcasting "and a great step in creating a global gaming business," said John Grace, a fund manager at Ausbil Dexia in Sydney. "Macao is becoming as big as Las Vegas and growing strongly."
.
The Sydney-based Publishing & Broadcasting paid 1.8 billion dollars for Melbourne's Crown Casino in 1999, and this year bought Burswood, the owner of Perth's only casino, for 637 million dollars. The two casinos account for 43 percent of the company's revenue.
.
The deal gives Ho access to Publishing & Broadcasting's experience in running resort-style casinos and a client list boasting some of Asia's biggest gamblers.
.
Publishing & Broadcasting says Crown is the world's biggest casino for "high rollers," or gamblers who wager large sums of money. In the 12 months that ended in June, high rollers bet 17.9 billion dollars at Crown, the company said in September.
.
Buying Burswood allowed Packer to attract more high rollers from Asia to Perth, the main Australian city closest to the continent.
.
"PBL, with Crown, Burswood and now Macao, is a more complete offering for a commission-based player," said Grace at Ausbil Dexia. "They can say to high rollers, 'Where would you like to go in our stable; to Burswood, Melbourne or Macao?' It opens up a huge opportunity with one of the biggest players there."
.
Packer and Ho will work together on expansion outside of Macao. Melco will take a 60 percent share of all opportunities in China and Publishing & Broadcasting will own 60 percent of anything in the rest of Asia, outside Australia and New Zealand.
.
Singapore's Ministry of Trade and Industry last month said it might soon ask companies to submit proposals on building a resort that may include the city's first casino.
.
Ho operates 13 of the 15 casinos in Macao. He also owns Macao's horse and dog racing tracks and stakes in its airline and airport as well as real estate, Macao's biggest department store and its second-biggest bank.
.
Macao, which reverted to Chinese rule in 1999, is the closest place for people from China, Taiwan and Hong Kong to gamble legally in casinos.
.
"Total gaming revenue in Macao will this year or next year exceed that of Atlantic City and become the second-largest after Las Vegas," said Winnie Chiu, a property analyst at DBS Vickers Securities HK.
.MACAO Publishing & Broadcasting said Tuesday that it had bought a stake in Stanley Ho's latest gambling project in Macao as Asia's two leading casino operators team up to expand in the region.
.
Publishing & Broadcasting, an Australian company controlled by Kerry Packer, said it would pay $163 million for 28 percent of the Park Hyatt hotel and casino development in Macao, owned by the Hong Kong-based Melco International Development, controlled by Ho. The two also plan to expand jointly in China and elsewhere in Asia.
.
Packer has transformed Publishing & Broadcasting, which owns Australia's top-ranked television network, into the country's biggest casino operator with 2.4 billion Australian dollars, or $1.9 billion, of acquisitions since 1999.
.
Ho has linked with Packer to meet competition from Las Vegas operators including Steve Wynn and Sheldon Adelson, after losing his 42-year Macao gaming monopoly in 2002.
.
"It's a significant opportunity" for Publishing & Broadcasting "and a great step in creating a global gaming business," said John Grace, a fund manager at Ausbil Dexia in Sydney. "Macao is becoming as big as Las Vegas and growing strongly."
.
The Sydney-based Publishing & Broadcasting paid 1.8 billion dollars for Melbourne's Crown Casino in 1999, and this year bought Burswood, the owner of Perth's only casino, for 637 million dollars. The two casinos account for 43 percent of the company's revenue.
.
The deal gives Ho access to Publishing & Broadcasting's experience in running resort-style casinos and a client list boasting some of Asia's biggest gamblers.
.
Publishing & Broadcasting says Crown is the world's biggest casino for "high rollers," or gamblers who wager large sums of money. In the 12 months that ended in June, high rollers bet 17.9 billion dollars at Crown, the company said in September.
.
Buying Burswood allowed Packer to attract more high rollers from Asia to Perth, the main Australian city closest to the continent.
.
"PBL, with Crown, Burswood and now Macao, is a more complete offering for a commission-based player," said Grace at Ausbil Dexia. "They can say to high rollers, 'Where would you like to go in our stable; to Burswood, Melbourne or Macao?' It opens up a huge opportunity with one of the biggest players there."
.
Packer and Ho will work together on expansion outside of Macao. Melco will take a 60 percent share of all opportunities in China and Publishing & Broadcasting will own 60 percent of anything in the rest of Asia, outside Australia and New Zealand.
.
Singapore's Ministry of Trade and Industry last month said it might soon ask companies to submit proposals on building a resort that may include the city's first casino.
.
Ho operates 13 of the 15 casinos in Macao. He also owns Macao's horse and dog racing tracks and stakes in its airline and airport as well as real estate, Macao's biggest department store and its second-biggest bank.
.
Macao, which reverted to Chinese rule in 1999, is the closest place for people from China, Taiwan and Hong Kong to gamble legally in casinos.
.
"Total gaming revenue in Macao will this year or next year exceed that of Atlantic City and become the second-largest after Las Vegas," said Winnie Chiu, a property analyst at DBS Vickers Securities HK.
.MACAO Publishing & Broadcasting said Tuesday that it had bought a stake in Stanley Ho's latest gambling project in Macao as Asia's two leading casino operators team up to expand in the region.
.
Publishing & Broadcasting, an Australian company controlled by Kerry Packer, said it would pay $163 million for 28 percent of the Park Hyatt hotel and casino development in Macao, owned by the Hong Kong-based Melco International Development, controlled by Ho. The two also plan to expand jointly in China and elsewhere in Asia.
.
Packer has transformed Publishing & Broadcasting, which owns Australia's top-ranked television network, into the country's biggest casino operator with 2.4 billion Australian dollars, or $1.9 billion, of acquisitions since 1999.
.
Ho has linked with Packer to meet competition from Las Vegas operators including Steve Wynn and Sheldon Adelson, after losing his 42-year Macao gaming monopoly in 2002.
.
"It's a significant opportunity" for Publishing & Broadcasting "and a great step in creating a global gaming business," said John Grace, a fund manager at Ausbil Dexia in Sydney. "Macao is becoming as big as Las Vegas and growing strongly."
.
The Sydney-based Publishing & Broadcasting paid 1.8 billion dollars for Melbourne's Crown Casino in 1999, and this year bought Burswood, the owner of Perth's only casino, for 637 million dollars. The two casinos account for 43 percent of the company's revenue.
.
The deal gives Ho access to Publishing & Broadcasting's experience in running resort-style casinos and a client list boasting some of Asia's biggest gamblers.
.
Publishing & Broadcasting says Crown is the world's biggest casino for "high rollers," or gamblers who wager large sums of money. In the 12 months that ended in June, high rollers bet 17.9 billion dollars at Crown, the company said in September.
.
Buying Burswood allowed Packer to attract more high rollers from Asia to Perth, the main Australian city closest to the continent.
.
"PBL, with Crown, Burswood and now Macao, is a more complete offering for a commission-based player," said Grace at Ausbil Dexia. "They can say to high rollers, 'Where would you like to go in our stable; to Burswood, Melbourne or Macao?' It opens up a huge opportunity with one of the biggest players there."
.
Packer and Ho will work together on expansion outside of Macao. Melco will take a 60 percent share of all opportunities in China and Publishing & Broadcasting will own 60 percent of anything in the rest of Asia, outside Australia and New Zealand.
.
Singapore's Ministry of Trade and Industry last month said it might soon ask companies to submit proposals on building a resort that may include the city's first casino.
.
Ho operates 13 of the 15 casinos in Macao. He also owns Macao's horse and dog racing tracks and stakes in its airline and airport as well as real estate, Macao's biggest department store and its second-biggest bank.
.
Macao, which reverted to Chinese rule in 1999, is the closest place for people from China, Taiwan and Hong Kong to gamble legally in casinos.
.
"Total gaming revenue in Macao will this year or next year exceed that of Atlantic City and become the second-largest after Las Vegas," said Winnie Chiu, a property analyst at DBS Vickers Securities HK.
.

An American casino company spearheading new growth in Macau's 150-year-old gambling industry plans to open the biggest gaming hall the southern Chinese enclave has ever seen, a media report said Thursday.

The Las Vegas Sands Group has told United States authorities that it plans to spend 1.8 billion US dollars building a new casino in the former Portuguese colony, The Standard newspaper reported.

The proposal gives the first insight into what planners have in mind for a huge 100,000 square metre reclamation linking two of the city's offshore islands that is expected to house some 20 new mega casinos and hotels by 2009.

Citing documents submitted to American securities chiefs, the report said the casino would resemble the company's flagship Venetian resort in Las Vegas.

The first phase will feature 1,500 hotel suites and 546,000 square metres of gambling halls, the report said.

Like its sister in Las Vegas, the Macau Venetian is likely to boast faux canals with gondoliers and Venice-themed facilities.

The new property will join the company's Sands Macau, which opened in May, the first foreign-owned casino to take advantage of new laws allowing overseas competition in what had been a gaming monopoly controlled by tycoon Stanley Ho.

The details were revealed in a submission ahead of a planned flotation by the company.

Sands is one of three overseas investors that have won concessions to open casinos under the semi-autonomous Chinese enclave's shake-up of gaming laws.

The law-change has given Macau's once-ailing gambling industry renewed vigour, injecting Vegas-style razzmatazz to a business that had developed a reputation for poor service and gang-related crime.

Huge growth in mainland Chinese tourist arrivals in the city has fuelled growth in a business that Sands boss Aaron Adelson predicts will eclipse even Las Vegas in terms of earnings as soon as next year.

Las Vegas Sands Inc, which is duplicating its Venetian Casino Resort in Macau, said in a filing this week with the US Securities and Exchange Commission that the project will cost about US$1.8bil.

Las Vegas Sands chairman Sheldon Adelson said at a briefing in Singapore in July last year that the Macao Venetian Casino Resort would cost US$600mil to US$800mil.

The new estimate is in the company's initial public offering filing.

US securities rules prevented the firm from commenting on the discrepancy before its share sale, Alpha Padilla, a Macau-based spokeswoman for Las Vegas Sands, said.

Betting on Macau: Las Vegas Sands' IPO gives investors a chance to buy into the hottest market in gambling
By Andrew Bary
6 December 2004
Barron's

In the late 1990s, when Sheldon Adelson decided to put a casino resort on the site of the Sands hotel, the famed haunt of Frank Sinatra, Dean Martin, Sammy Davis Jr. and the rest of the Rat Pack, rival Las Vegas casino operators scoffed at the idea, and Adelson struggled to raise the $1.5 billion to put up what became the Venetian.

Adelson's focus on convention business and retailing was deemed foolish in a city where the emphasis hadalways been on gambling. But he's been vindicated because the Venetian is the second-most profitable casino property in Las Vegas -- behind only MGM Mirage's Bellagio -- and is likely to produce over $300 million in cash flow in 2004. Adelson earlier this year scored a major coup by selling the Venetian's high-end shops for a hefty $766 million to General Growth Properties. Now, an initial public offering of his company, Las Vegas Sands, stands to make him the richest casino operator on the Strip . . . or anywhere else, for that matter.

In part, the deal's roots lie in Adelson's courting of the Chinese government three years ago, after Beijing decided to turn Macau, a former Portuguese colony near Hong Kong with a seedy and violent image, into the Las Vegas of the East. Adelson won one of only three coveted casino-operating licenses, along with Steve Wynn of Wynn Resorts and Stanley Ho, the established casino operator who had enjoyed a decades-long monopoly in Macau, the only place in China with legalized gambling.

While Wynn didn't start his project until Macau had passed a law this summer letting casinos extend credit, Adelson plowed ahead with construction of the $250 million Sands Macau casino. Opened in May, it's already a big success and may generate $300 million in pre-tax cash flow in the next year, a huge return on investment. The low-profile Adelson, 71, has first-mover advantage among Western operators in Macau; Wynn's project probably won't be finished until late 2006.

Las Vegas Sands aims to become a dominant player in Macau, which could boom because of the strong interest in gambling among China's 1.3 billion people. Adelson is building a $1.8 billion version of the Venetian resort in Macau. It's due to open in 2007, and his company has deals with six hotel operators to operate casinos on their properties that might be developed on what the Chinese hope will be a Vegas-type Strip.

Macau is the global gaming industry's hottest story. Adelson will cash in on it through the Las Vegas Sands IPO, expected to arrive around Dec. 14 through underwriters led by Goldman Sachs. The deal should push Adelson's casino wealth ahead of that of Kirk Kerkorian, the controlling shareholder of industry leader MGM Mirage, and Steve Wynn, CEO of Wynn Resorts. Adelson's holding is apt to be worth $6.5 billion, versus Kerkorian's $5 billion stake in MGM Mirage and Wynn's $1.5 billion interest in Wynn Resorts.

"Adelson's story is incredible," says Neil Barsky, head of Alson Capital, a New York investment firm. "You have to remember the skepticism in Vegas that greeted him as an outsider. How could a guy who ran a trade show compete with the likes of MGM, Mandalay or Steve Wynn? This company has a lot of credibility." Adelson made his fortune in 1995 when he sold his controlling stake in Comdex, the computer trade show, to Japan's Softbank, for $800 million.

Las Vegas Sands will offer 23.8 million shares in the IPO, a sliver of its total equity, at $20 to $22 a share. At that range's midpoint, the company would be valued at $7.35 billion, versus $7 billion for Harrah's Entertainment and $9 billion for MGM Mirage. After the sale, Adelson would still control 308 million shares -- 88% -- of the 350 million that would be outstanding.

His holding was boosted by a sweet deal he engineered in July, when he sold the Sands Expo Center, the convention center adjacent to the Venetian, to Las Vegas Sands. He owned the Sands Expo Center and a preferred-stock interest in the Venetian through a company called Interface Holding. Interface was valued at $331 million, net of debt, based on an independent appraisal.

Rather than getting cash for Interface, Adelson was granted additional stock in Las Vegas Sands at a very cheap price. He received equity that will be transformed into 58.6 million shares worth about $1.2 billion -- four times Interface's appraised value. The prospectus for the Las Vegas Sands offering says the deal was approved by the company's independent directors. Such is the benefit of controlling a private company. The Interface deal could never have happened if Las Vegas Sands had been public.

Wall Street is focused on the growth opportunities for Las Vegas Sands in Macau, Las Vegas and elsewhere. The company broke ground this summer on a Vegas casino resort adjacent to the Venetian, called Palazzo. The $1.6 billion project, with a Beverly Hills-Rodeo Drive theme, will be completed in 2007.

Investors will be comparing Las Vegas Sands to Wynn Resorts, which has a $5.5 billion market value despite minimal current revenues. Wynn will open its luxurious Wynn Las Vegas resort in April and its Macau hotel-casino in 2006. Las Vegas Sands will be valued at about 12 times projected 2005 cash flow of $625 million -- $325 million from the Venetian and $300 million from the Sands Macau. These are Barron's estimates; the company isn't talking publicly.

MGM Mirage and Harrah's each trade around nine times estimated 2005 pre-tax cash flow, a common industry valuation benchmark. Las Vegas Sands is apt to command a premium to them because of its stronger growth prospects. Adelson's company could generate `07 cash flow of over $1 billion when the new casino resorts in Macau and Vegas open.

In addition, the company will emerge from the IPO with just $300 million of net debt. By contrast, MGM Mirage initially will have $11 billion of debt after its all-cash acquisition of Mandalay Resort Group in early 2005. Part of the funds to pay for Palazzo's construction will come from the sale of its retail stores to General Growth Properties for at least $250 million and perhaps as much as $700 million.

The risks with Las Vegas Sands come from its current reliance on just two properties. Macau also is no sure thing. While the Chinese are encouraging the development of Western-style casino resorts there, Beijing's attitude could change. Gambling taxes in Macau could rise, new casino licenses could be granted and Chinese-American relations could sour.

Macau casino revenues this year could top $5 billion, rivaling the entire Vegas Strip. It would be ironic if America's most successful export to China isn't cars, appliances or movies, but Vegas-style casino gambling.

The Sands Macau casino has been mobbed since it opened, drawing over 800,000 visitors in October alone. It generated $68 million of pre-tax cash flow and $61 million of net income in the third quarter. Back in June, when Barron's profiled the prospects for Las Vegas Sands' IPO, president William Weidner said it was "like New Year's Eve every night" in Macau, with gamblers packing the tables around the clock on weekends. Chinese gamblers prefer table games, particularly baccarat, over slot machines, which generate the bulk of U.S. casinos' profits.

The Las Vegas Sands combines two of the hottest current investment themes: China and casinos. The IPO clearly will be a boon for Adelson and could prove a winner for new investors if the casino boom in Macau and Las Vegas continues.

As visitor arrivals to China's Macao Special Administrative Region (SAR) topped 16.67 million in the year 2004, the tourist industry has brought great profits and huge challenges to the city famed for its lucrative gaming industry.

Macao, which will be the host city of the 2005 PATA Annual Conference in April, is enjoying a rising international reputation as a popular tourist city in Asia, and could not allow the gaming business dampen the city's tourist image.

Joao Manuel Costa Antunes, director of the Macao Government Tourist Office (MGTO) said at a press conference here Wednesday that to add to the city's cultural and leisure tourist initiatives,Macao should develop various tourist products such as health and beauty tours, sports and convention tours and ecology tours to lure tourists of different interests.

He said that in 2005, Macao is looking forward to the confirmation of the World Heritage list of the United Nations Educational, Scientific and Cultural Organization for its application of "Historical Monuments of Macao," which consist of 12 architectural sites in Macao.

"By promoting the cultural tourism, we will make visitors awareof Macao's unique blend of Chinese and Portuguese cultures," said Antunes

Tourism and gaming industries are two of Macao's economic pillars. The SAR government reaped 14 billion patacas (1.75 billion US dollars) in gaming tax in 2004, after liberalizing the gaming sector in 2002.

However, the tourist official emphasized that a favorable tourist environment and high standards of service are crucial factors to building up Macao's image as a quality destination.

"We will improve tourism facilities and develop brand new attractions while update the relevant bills to cultivate a healthytourism industry," said Antunes.

Under the objective of the SAR government to develop Macao intoa tourism, gaming, MICE (meetings, incentives, conferences and exhibitions) and leisure hub, a series of new tourism and entertainment facilities have started operation or will be completed soon.

Macao hosted a total of 16.67 million visitor arrivals in 2004,representing a surge of 40 percent over 2003, which went close to the saturating point of city's tourist accommodating capacity of 16.79 million a year.

Among the total, 9.5 million were visitors from China's mainland, which increased by an annual growth rate of 66 percent over the previous year. Autunes expected the number of visitors from the source market will continue to rise based on closer cooperation and exchanges between the mainland and Macao.

At present, over 30 percent of the mainland travelers came under the mainland's facilitated individual travel measures on Hong Kong and Macao-bound tours, which was initiated on July 28, 2003.

Macao's present tourist facilities could hardly accommodate therising number of tourists. Currently, there are 43 hotels and 33 guesthouses in Macao offering a total of 10,502 hotel rooms. In the next seven years, another 16,750 hotel rooms will come off stream to meet the tourist demand, according to the tourist authority.

A senior economic official hinted that "18" to "19" would be the maximum number of casinos for Macao's casino mogul Stanley Ho, according to Friday's Macao Post.

Francis Tam Pak Yuen, secretary for economic and finance of theMacao Special Administrative Region government, who oversees the gaming sector, said the government and the Macao Gaming Co. Ltd (SJM) owned by Stanley Ho were exchanging views on the issue of itsmaximum number of casinos, as well as the possibility of merging several small casinos into medium-sized ones.

Meanwhile, some industry insiders expected that as the government liberalized the gaming sector in 2002, Macao's total number of casinos will reach about two dozens by the end of the decade.

Ho had dominated Macao's gaming sector for 40 years before 2002,and his SJM now operates 14 casinos with two more slated to be opened shortly.

Macao's legislation on gaming business limits the number of casino-operating concessions to three. However, the number of casinos or sub-concessions that each of the three concessionaires may run is not specified by law. Enditem

Watchmaker Medtech Group yesterday announced another acquisition in a hotel -casino complex in Macau, five weeks after the company unveiled its plan to tap the enclave's gambling market.

Medtech had agreed to buy the 88-room Hotel Casa Real for $ 1.25 billion - at $ 750 million in cash and $ 500 million in up to 1.1 billion new shares at 45.45 cents each, the company said.

Chairman Jenkin Cheung said the firm planned to focus its business on hotels with gaming. "Following the acquisition of the Grandview Hotel last year and the recent disposal of Starway, we are taking a step forward to acquire Hotel Casa Real," he said.

Reflecting the diversification, the company will be renamed Golden Resorts Group.

"We are confident that it will enable the company to capture the results from the economic boom in Macau," Mr Cheung said.

On January 10, Medtech sold its 35 per cent stake in Starway Management, a producer of advanced technology energy-saving products in China, for $ 52 million. The company expects to net a profit of $ 2 million from the disposal.

Last month, Medtech said it would acquire the 407-room Grandview Hotel in Taipa and the attached gambling facility from Stanley Ho Hung-sun for $ 500 million, including $ 400 million in cash and an issue of 500 million new shares at 20 cents each.

The company funded the acquisition through a top-up placement last month raising $ 510 million.

The 1.1 billion new shares issued for Hotel Casa Real represent about 9.89 per cent of the enlarged issued share capital and the 45.45-cent price is a discount of about 15.83 per cent to the last closing price of Medtech shares at 54 cents on January 5. Shares in Medtech will resume trading today.

Macau residents have gained the right to wager on Hong Kong races in a three-year deal approved under the Betting Duty Ordinance in accordance with a Deed for Telecast and Placing of Bets on Horse Races.

The Hong Kong Jockey Club struck the deal with the Macau Horse Racing Co. Macau residents will be able to bet on Hong Kong races at authorized venues on their island with a takeout rate of 6%, which is half the rate of those received in Hong Kong. The Hong Kong Jockey Club will pay the government half the money it receives on wagering from Macau.

The arrangement works only one way and thus Hong Kong residents will not be able to wager on Macau races.

Bets on Hong Kong horse races will be accepted in Macau, the first overseas betting arrangement approved under the Betting Duty Ordinance since the relevant provisions were enacted.

Effective for three years, the approval is made in accordance with a Deed for Telecast & Placing of Bets on Horse Races relating to a one-way betting arrangement between the Hong Kong Jockey Club and Macau Horse Racing Company.

Bets can be placed on the club's races at the company's authorised venues in Macau. Specifically, only-win bets, place bets, double bets, quinella bets, forecast bets and quinella-place bets will be accepted.

Betting duty on overseas bets will be at half the rate of those received in Hong Kong, which will be set at 6% of the total betting turnover.

Macau's 16 casinos generated a total gross revenue of about 3.6 billion patacas (US$450 million) in January, an increase of some 20 percent over the same month last year.
Wednesday's Macau Post quoted its source as saying that 14 casinos affiliated to the Macau Gaming Co Ltd owned by tycoon Stanley Ho held 70 percent of the total gross revenue. The remainder was shared between the Las Vegas-invested Sands Casino and the Hong Kong-run Galaxy Waldo Casino.
The casino business yielded a gross revenue of around 40 billion patacas (US$5 billion) last year, representing a year-on-year increase of 40 percent.
As the casinos were contracted to pay 35 percent of their gross revenue to the government's tax coffer, the Macau Special Administrative Region government taxed 14 billion patacas (US$1.75 billion) from the sector last year.
Economists expect the government's casino tax income to exceed 18 billion patacas (US$2.25 billion) this year.
Macau is the only city in China where gambling is legal. The first gaming businesses were licensed in around 1847 in the city.

American casino giant MGM Mirage is close to securing regulatory approval for its proposed joint venture with gambling heiress Pansy Ho to build a casino in Macau, according to company executives.

``We expect to begin construction in the second quarter of 2005,'' chairman and chief executive Terry Lanni said Wednesday.

Asked by an analyst specifically about the approval process, general counsel Gary Jacobs said: ``We believe we are making satisfactory progress.''

Former gaming regulators had expected MGM to encounter some difficulty in the approval process because of Ho's involvement with Sociedade de Turismo e Diversoes de Macau and Sociedade de Jogos de Macau (SJM), her family's privately held gambling businesses. Ho is a director of both companies, as well as managing director of Shun Tak Holdings, the Hong Kong-listed hotel, shipping and property company also controlled by the family. MGM's 50-50 joint venture with Ho would operate the casino under a subconcession from SJM. (Ho is also a director of The Standard's parent company, Global China Group.)

Regulators in any of the American states in which MGM operates could take action to block the deal, but Jacobs said that only in Mississippi are officials required to formally approve or reject the deal. MGM applied for approval there at least four months ago, but the Mississippi Gaming Commission has yet to take up the request.

Jacobs, however, said the commission has approved involvement by other companies in Macau before. MGM has yet to apply for approval from the Macau government, Gaming Inspection & Coordination Bureau director Manuel Joaquim das Neves said. Nevertheless, Lanni said that MGM and Ho are proceeding with design work on the MGM Grand Macau. MGM originally wanted to open the casino next year, but its target date has slipped to early 2007.

MGM plans to invest US$280 million (HK$2.18 billion) of its own cash in the casino. James Murren, the company's president and chief financial officer, said it expects to seek a big bank loan in April or May for additional funds for the project and that Ho will be putting equity into the MGM Grand Macau as well.

``The proceeds from the operation of that property will likely be able to fund future expansions of not only that property but perhaps a second or a third casino also in Macau,'' he added.

K Wah Construction Materials Ltd. (0027.HK) said Thursday the Macau government has approved a potential transfer of up to 90% in one of Macau's three gaming license holders to the Hong Kong construction materials provider.

However, K Wah said the approval doesn't commit any shareholder in the license holder, Galaxy Resort & Casino, to dispose of their interest, despite the fact that the family that runs K Wah is the controlling shareholder of Galaxy.

K Wah also reiterated that negotiations relating to the possible transfer haven't yet begun, though it is of "fundamental importance to preliminary conceptual studies."

Trading in K Wah has been suspended since Jan. 21 as requested by the Securities and Futures Commission, less than two hours after it had resumed trading, following a report to the Hong Kong bourse that it was being informed by Galaxy about the possible transfer.

K Wah's shares were suspended from trading after it issued for the first time a disclosure about a potential injection of a Macau gaming license into the firm. But the SFC wasn't satisfied with the conflicting statements it had filed and asked for further clarification.

In its latest stock exchange announcement Thursday, K Wah said its chairman, Lui Chee Woo, is the ultimate controlling shareholder of Galaxy. His elder son Francis Lui is a director for both K Wah and Galaxy.

K Wah said its preliminary talks with the controlling shareholders of Galaxy started in late May 2004, when "it was discussed whether it might be worthwhile to consider investigating the possible injection of Galaxy into K Wah."

However, in a previous announcement on Oct. 14 to clarify media reports related to the injection of the gaming business into K Wah, K Wah stressed that "there have been no developments that should be brought to the attention of the respective shareholders of K Wah and potential investors."

Though both firms are controlled by the same family, they are separately conducting preliminary "conceptual studies" on the asset injection, K Wah said.

K Wah said it has almost completed its own initial studies. It said it will seek from its board in due course a mandate to enter into formal negotiation for acquiring shares in Galaxy.

MACAO - Macao's 16 casinos generated a total gross revenue of about 3.6 billion patacas (US$450 million) in January, an increase of some 20% over the same month last year. Wednesday's Macao Post quoted its source as saying that 14 casinos affiliated to the Macao Gaming Co. Ltd. owned by tycoon Stanley Ho held 70% of the total gross revenue. The remainder was shared between the Las Vegas-invested Sands Casino and the Hong Kong-run Galaxy Waldo Casino. The casino business yielded a gross revenue of around 40 billion patacas (US$5 billion) last year, representing a year-on-year increase of 40%.

THE neon lights in Macau are beckoning and it's set to become the world's playground.

Associate Professor of Economics Winston Koh of Singapore Management University (SMU) argued as much in a paper he presented at an Institute of Policy Studies forum last November.

The border crossing between the Chinese city of Zhuhai and Macau has become one of the busiest in the world, he noted.

The casinos in Macau are pulling in the Chinese tourists.

Last year, Macau's 13 licensed casinos raked in about US$5.1 billion ($8.34b), up 34 per cent from 2003, reported the latest issue of Time .

That's just about equal to Las Vegas Strip's takings for the year.

For now, the money is on Macau to overtake the Strip this year, said Time, quoting Mr Marc Falcone, a gaming analyst at Deutsche Bank in New York. 'Go East' seems to the mantra these days. And with eyes lit, Western gaming bigwigs are putting their money there.

The Vegas moguls are setting up shop - or in some cases, hoping to - in Asia.

Macau has already caught their eye.

Las Vegas casino king Steve Wynn is opening a $700 million ($1.1 billion) resort there.

And just a roll of a dice away, Vegas hotshot Sheldon Adelson is building a US$1.8b ($2.9b) 3,000-room Venetian hotel.

Some 8.7 million Chinese went to Macau in the first 11 months of last year - making up more than half of the total of 15.2 million visitors it had in that time.

The money the Chinese spend in Macau fuels much of its tourism industry and helped the city's GDP soar 47.6 per cent in the second quarter of last year, reported Time.

With a growing middle-class and a ban on gambling in the mainland, you don't need to be a rocket scientist to figure out that casino-crazy Chinese tourists will be a cash cow for the tourism industry anywhere.

And Asian cities are already staking their claim on the Chinese pie. Even the Philippines is looking at ways to to open up its small casino industry to foreign investors.

Macau is well-placed - it has a more than a billion people within a three-hour flight radius.

What's more, in addition to the neon-lit facilities which appeal to high rollers, Macau is quickly positioning itself as a destination for families and business conventions.

Plus, budget airline Air Asia already flies to Macau straight from Bangkok and Kuala Lumpur.

But Macau is not the only one in this region in the gaming game.

SOUTH KOREA - Weekend fun

South Korea is also drawing interest from major gaming companies, noted Assoc Prof Koh. It may not be as impressive as Macau, but it is within a three-hour flight radius for over 400 million people.

Dress up casino facilities with golf courses, theme parks and convention halls, and South Korea may have the potential to draw Chinese and Japanese weekend visitors and businessmen, said Assoc Prof Koh.

With just one of its 17 casinos opened to locals, it is foreign visitors who are bankrolling South Korea's casinos.

They raked in US$917 million in 2003. And it looks like the South Koreans are anxious to play their cards right.

Last October, the South Korean government granted new licences to two new operators - one in the capital Seoul and the other in the southern city of Busan.

The explanation given?

That the country has to make the local casino industry more competitive in the light of big US players entering the casino market in Asia.

A government-linked company has already announced plans to build a US$3 billion casino project on Yeong Giong Island - easily accessibly from Seoul and just an hour's flight away from Beijing and Shanghai.

These developments in the region - with the flurry of activity in Macau and South Korea leading the pack - back the proponents of the Singapore integrated resort.

Assoc Prof Koh wrote: 'In light of plans by Macau and South Korea to liberalise the gaming sector further, there are concerns that Singapore would see further erosion in tourist arrivals and lose out if the integrated resort-casino is not developed.'

CALLS FOR CASINOS CLOSER TO HOME...

MACAU's success has other countries also clamouring for a bigger slice of the Chinese tourism pie.

In Hong Kong, there has been a push to allow for casinos to be built on an island.

In Japan, there are calls for casinos in major cities. The Philippines is looking for foreign investors to open casinos.

Two new casino halls opened for business in Macau yesterday, aimed at the tourists arriving during the Lunar New Year travel spree.
The renovated Fortuna Casino at the former Fortuna Hotel became the 15th casino owned by Macau tycoon Stanley Ho's gaming empire. The casino next to Ho's flagship casino - Hotel Lisboa - is a small-scale casino offering 35 gaming tables.
On the same day, Macau's first Las Vegas-invested casino Sands Macau added the "Pearl Room," a new themed luxury gaming room, hosting 40 gaming tables in addition to 180 slot machines.
Ho's Macau Gaming Co Ltd is experienced in promoting business during holidays.
It opened the Casa Real Casino last year to coincide with the bumper holiday season of China's National Day, and the Greek Myth Casino during the Christmas and New Year season.
Both are renovation projects on the company's former assets.
By updating his casinos, Ho is rising to the challenge from his rivals, the Venetian, which owns the Sands Macau, and the Hong Kong-based Galaxy that runs the Galaxy Waldo Casino.
The gaming city is experiencing its best-ever economic growth period. In January, Macau's 16 casinos generated 3.6 billion patacas (US$450 million) in total gross revenue, an increase of some 20 percent over the same month last year.
A senior economic official hinted that "18" to "19" would be the maximum number of casinos for Ho, who had monopolized Macau's gaming industry for 40 years before 2002.
Francis Tam Pak Yuen, secretary for economic and finance of the Macau Special Administrative Region government, who oversees the gaming sector, said the government was exchanging views on the issue with Ho's company.
Some industry insiders believe that following the gaming sector liberalization, the total number of casinos in Macau will reach about two dozens by the end of the decade.
Macau's legislation on gaming business limits the number of casino-operating concessions to three.
However, the number of casinos or sub-concessions that each of the three concessionaires may run is not specified by law.
Macau is the only city in China where gambling is legal. The first gaming businesses were licensed around 1847.

Zach Coleman in Macau


February 8, 2005



Macau's casino barons rolled out new gambling halls ahead of what is expected to be a bumper holiday season - the first Lunar New Year of competition in the territory.

To have sufficient staff to keep all its tables open around the clock during the holidays, the Sands Macau has suspended training sessions and holiday leave. The casino's 45 VIP suites are all booked for favored high rollers. Minimum table bets, which are sometimes adjusted every hour to calibrate demand, will float higher during the holidays. Both Las Vegas Sands and rival Sociedade de Jogos de Macau (SJM) have scoured for space to set up new tables. Both opened new halls with about 40 new tables each.

SJM found room in the basement and lobby level of the Hotel Fortuna, a 150 million pataca (HK$151.59 million) project, chipping off some restaurant space. The Fortuna is a block away from the Hotel Lisboa.

The Sands opened its new ground-floor ``Pearl Room'' in an area previously earmarked for shops. The hall features 180 electronic gaming machines in addition to tables, adding to the 671 slot machines and 328 tables already open at the Sands.

Director of casino operations Walter Power said he could not provide a figure for the cost of the Pearl Room, but said more table space may be made as the company capitalizes on rising demand.

``We're looking at every square inch of this place,'' he said.

The casino is still finishing work on three presidential suites and three penthouse suites that Niall Sean Murray, senior director for non-gaming operations, estimates will open in several months.

The Sands does not collect revenue for any of the suites. They are offered to gamblers wagering big sums.

Las Vegas Sands is also opening its first private betting salons at its flagship Venetian casino in Las Vegas in time for Lunar New Year.

Power said the company is modeling those salons on the Sands Macau's VIP areas.

Power said that Sands is now working with two junket agents in Macau to bring in high rollers. ``We're issuing credit to select players,'' he said.

But because the government has yet to offer a tax deduction for uncollectible gaming debts, he said, the casino is being more conservative than at the Venetian in Las Vegas.

One change for the New Year is that smoking is banned in the new Pearl Room. Power said the Sands opened with no restriction on smoking, counting on its spacious, well-ventilated layout to disperse fumes, but after some complaints began restricting smoking in some spots.

Power estimated about 10 percent of punters smoke.

China's crackdown on gambling has not affected traffic to the Sands, Power said.

Las Vegas Sands Corp. announced today that the Sands Macao, the first western-operated casino in Asia, has opened the luxurious Pearl Room, a new themed gaming room bedecked with sparkling pearl chandeliers situated adjacent to the main lobby of the Sands Macao.
The new Pearl Room features 17,000 sq. feet of space hosting 40 gaming tables, including baccarat, fan tan, Caribbean stud poker, three card baccarat, blackjack, big and small, and roulette, in addition to 180 slot machines specially designed for the Asian market.

"The Sands Macao continues to up the ante when it comes to elegance and sophistication in Macao," said Mr. Frank McFadden, Sands Macao chief operating officer. "The opening of the Pearl Room gives visitors and locals alike yet one more reason to visit the Sands Macao and experience the height of luxury."

In line with Sands' philosophy of fostering local talent, all the dealers in the Pearl Room are local Macao residents who have undergone Sands' rigorous training course.

The 40 additional tables in the Pearl Room represent a 12.5% increase taking the total number of tables to 360. The total number of slots will now be 848, or a 28% increase.

AFP
Hong Kong, February 9, 2005

There were red faces all round when Macau casino tycoon Stanley Ho turned the air blue with smutty jokes at a gala Chinese New Year ball attended by the city's top dignitaries, a source said on Wednesday.

The billionaire gambling kingpin told a string of off-colour gags at the annual dinner in his showpiece Casino Lisboa.

Referring to the upcoming year of the rooster, Ho made jokes based on the Cantonese slang meaning of the word chicken -- prostitute.

"All you wives must watch your husbands this year," he told some 2,000 guests on Tuesday night. "Because they might be out with prostitutes from the Casino Lisboa."

Macau's casinos are notorious haunts for call girls who prey on the high rollers of the VIP rooms.

The source, who witnessed the display of crude jokes, said the guests -- which included the southern Chinese enclave's Beijing-picked leader Edmund Ho (not relation) -- were visibly unimpressed.

"The jokes did not go down very well. They were very crude and inappropriate," said the source.

MACAU -- As reported by Xinhua: "Two new casino halls opened for business in Macau yesterday, aimed at the tourists arriving during the Lunar New Year travel spree.

i-Newswire, 2005-02-09 - "The renovated Fortuna Casino at the former Fortuna Hotel became the 15th casino owned by Macau tycoon Stanley Ho's gaming empire. The casino next to Ho's flagship casino - Hotel Lisboa - is a small-scale casino offering 35 gaming tables.

"On the same day, Macau's first Las Vegas-invested casino Sands Macau added the 'Pearl Room,' a new themed luxury gaming room, hosting 40 gaming tables in addition to 180 slot machines.

"...By updating his casinos, Ho is rising to the challenge from his rivals, the Venetian, which owns the Sands Macau, and the Hong Kong-based Galaxy that runs the Galaxy Waldo Casino..."

LAS VEGAS, Feb. 17 /PRNewswire-FirstCall/ -- MGM MIRAGE (NYSE: MGG - News) announced today that the Mississippi Gaming Commission has unanimously granted a waiver of approval with respect to the Company's application to engage in gaming activities in Macau S.A.R. The Company intends to develop, construct and operate, through a 50/50 joint venture with Pansy Ho, a resort hotel casino complex in Macau. The venture is subject to further regulatory review. Construction of the MGM Grand Macau is anticipated to commence in the second quarter of 2005, and to be completed for an opening in 2007.

Zach Coleman


February 17, 2005


After teasing shareholders for two months with the possibility of a Macau gambling investment deal, Fortuna International Holdings has at last announced a HK$50 million agreement to take a 30 percent stake in a casino hotel in the territory.

Fortuna unveiled its aims on the Grand Hotel, a vintage property near the city's central square that closed five years ago.

The Hong Kong firm will invest in a venture that began renovating the hotel in December but Fortuna will not contribute to the upgrade costs.

The renovated New Grand Hotel will have 50 guest rooms and include a casino with 14 public gaming tables and six tables in a VIP room.

Fortuna said the price of its stake in the venture represents a 40 percent discount to its independently appraised value to reflect the chance of other hotels and casinos opening in the immediate area and the possibility that Macau might grant more casino operating concessions.

With the news that Macau gambling assets are selling at a discount, shareholders dumped their Fortuna holdings, sending the stock price down 16.7 percent to 3.5 cents.

Trading in the shares had been suspended since January 20. Fortuna's shares traded at a penny a piece shortly before the company first mentioned its interest in Macau. The price peaked at eight cents before the company announced delays in closing the deal last month.

The New Grand venture acquired rights to run the property for six years last April, but Fortuna said New Grand does not yet have an operating license or a deal with a casino operator, though it expects 40 percent of casino profits.

The 30 percent stake in New Grand that Fortuna is acquiring represents half of Lam Po-ying's interest in the project. Fortuna will pay Lam a mix of shares and cash to be determined later, but the deal stands to make her the second-biggest shareholder in Fortuna. Macau legislator Vitor Cheung indirectly holds a 30 percent interest in the project. Ho Yen-bing holds a 10 percent stake and Fortuna said he will serve under contract ``as the manager responsible for the promotion and marketing of the casino in the hotel to local customers and overseas tourists.''

Fortuna said the Grand Hotel is included in the area being redeveloped for the Ponte 16 project, but Marco Lee, executive director of Ponte 16 shareholder Macau Success, said Wednesday he was unaware of the plan to put a casino in the hotel.

Speaking after Macau Success' annual shareholder meeting, Lee said he expects Ponte 16 will open its own casino in summer 2006. The casino will be followed by a shopping area with a historical theme and a 270-room luxury hotel. Casino operator Sociedade de Jogos de Macau holds a 51 percent stake in the HK$1.2 billion project and Macau Success owns 24.5 percent.

Lee said the partners had given American architectural firm Jerde Partnership a six-month commission to design Ponte 16.

Jerde designed the new Langham Place mall in Mong Kok and was involved in the design of the Hong Kong Convention and Exhibition Centre and Cyberport.

16 February 2005

by Howard Stutz

Las Vegas Gaming Wire

RENO, Nevada and MACAU -- Casino gaming is continuing its rapid expansion into the Chinese gaming enclave of Macau, and the industry's leading slot machine manufacturer announced Tuesday it was creating a division to serve the growing market.

Reno-based International Game Technology said the formation of IGT-Asia will serve an area that could be the industry's primary growth vehicle during the later part of this decade.

Las Vegas Sands Corp. now operates the Sands Macau casino, which has 670 slot machines and 328 table games. The company plans to expand the property and also plans to develop the Macau Venetian casino and six hotel properties on the nearby Cotai Strip area that will also include casinos.

Wynn Resorts Ltd. is developing a casino in Macau, and MGM Mirage is also exploring development opportunities in the area.

IGT spokesman Ed Rogich said the new division reflects the emphasis the company is placing on expanding its overseas business. IGT also has a strong presence in Japan and, along with several casino operators, is watching gaming developments in Singapore.

With domestic growth somewhat slowed in 2005, IGT and other slot machine manufacturers are turning to foreign markets to boost sales.

"Asia, and specifically Macau, is rapidly becoming one of the most important gaming markets in the world," IGT international division President Paulus Karskens said in a statement. "It is crucial that IGT have a local sales and support presence in that market."

IGT Managing Director Scott Winzeler, formerly IGT's director of international markets, will oversee the Macau office.

Rogich said that as more Western-style casino developments open in Macau, slot machines and other electronic gaming equipment will become more prevalent. He said the new Macau office gives IGT a starting point as new casinos are developed.

Macau's rapidly developing casino industry is taking between HK$10 billion and HK$15 billion in gambling dollars out of Hong Kong every year, Jockey Club chairman Ronald Arculli said Sunday.

This represents a serious threat to the Jockey Club's financial fortunes and could result in a loss of revenue for the government, he told Radio Television Hong Kong in an interview.

Arculli also said that should the government agree to establish a tourist-only casino on Lantau, the Jockey Club should be allowed to run it to ensure that the gaming dollars and the profits remained in Hong Kong.

Arculli's claim was disputed by Deputy Secretary for Home Affairs Stephen Fisher, who said the drop in the club's turnover is not linked to Macau developments and that the decrease in racing revenue is being compensated by football betting income.

Arculli said he was delighted when the betting turnover for the Lunar New Year race meeting on February 11 reached HK$1.043 billion, the highest single-day turnover for the current season and HK$20 million up on last year's Lunar New Year take.

Attendance was also up from 74,322 last year to 76,030.

However, Arculli said the club's consultants had warned that, with Macau's gambling industry mushrooming, the turnover in Hong Kong could drop between HK$10 billion and HK$15 billion a year.

This was despite the recent cross-betting arrangement that allowed punters in the former Portuguese enclave to bet on Hong Kong races through Macau betting outlets.

Current figures indicate this to be around HK$20 million a meeting.

Arculli said that should the predicted drain of gambling dollars come about, the turnover from horse racing for the current season could drop between
10 percent and 20 percent over last year's total of HK$65 billion.

Macau had earlier estimated that the net profit from its gambling industry could reach US$5 billion (HK$39 billion) a year.

``Some other places such as Singapore and Thailand are also establishing casinos and developing their gambling industries,'' Arculli said. ``Some of them are also decreasing their betting tax.''

``We have been passing on this information to the government during discussions on our call for a change in the way horse racing is taxed.''

Arculli said tycoons in Macau have been stepping up their efforts to attract gamblers from Hong Kong.

And at least nine cruise ships catering to gamblers leave Hong Kong shores each day.

Arculli said that in an attempt to offset this drain on gaming dollars, the club would cooperate with travel agencies and Hong Kong Tourism Board to attract more mainland visitors to its two racecourses.

The club's annual turnover for horse racing peaked at HK$92.3 billion in 1997.

There were small but steady declines for the next two years before a slight rise in 2000-2001 when the club increased the number of race meetings a year from 75 to 78. It has been downhill since then, reaching HK$65 billion at the end of the last racing season in June.

Arculli said the club's discussions with the government on its proposal to change the way racing is taxed were making only ``a little progress.''

The government currently takes 12percent off standard win, place and quinella bets and 20 percent on exotic and multiple bets.

The Jockey Club wants the government to switch from a tax on bets to a tax on gross profits, as is now the case with football betting.

Arculli said that in addition to trying to convince the government, the club feared that lawmakers did not fully realize the importance of reforming the betting tax system.

He said it is not pushing for a change in the system to increase betting revenue but to help the government secure a stable income in addition to enabling the club to donate HK$1 billion each year to charity.

According to sources, one of the reasons why negotiations with the government are dragging is because Financial Secretary Henry Tang does not want to become personally involved.

Tang is a long-time member of the club as well as a horse owner and fears he could be accused of a conflict of interest should the club be seen to be getting special privileges.

Arculli said he personally feels that a casino on Lantau is not a good way to raise additional revenue for the government.

However, since it could help attract tourists and develop Hong Kong's financial market, the Jockey Club should be granted rights to operate it.

``We are a non-profit making organization. This ensures that profits generated from the casino will go to the government and to charity organizations,'' he said.

Fisher rejected Arculli's claim that the decrease in betting turnover was caused by Macau's gambling industry.

He said the drop in turnover was due to the fact that youngsters were not interested in horse racing.

He also believed that income from football betting could offset the loss in horse racing.

February 21, 2005
NEWS; Pg. 2
285 words

Jimmy Cheung

Macau's flourishing casino business may draw an extra $ 15 billion away from the Hong Kong Jockey Club each year, the club chairman has warned.

Ronald Arculli also said if the government gave the go-ahead to develop casinos on Lantau, the club should run the businesses as non-profit enterprises.

The club's own consultancy studies have estimated Hong Kong could lose $ 10 billion to $ 15 billion in betting turnover annually to Macau because of the growing casino industry.

The figures were based on Macau's own estimate of an annual $ 40 billion in profit this year.

"The amount of betting turnover lost could be enormous. We have to tackle the problem," Mr Arculli told an RTHK radio programme yesterday.

He said the club had briefed the government on new casino proposals and betting duty changes in other places in the region, and called for suitable reforms to keep up with the trend.

Another proposal to curb the loss of turnover is to scrap the summer break on horse racing.

"We have to discuss with the government a package of measures, including taxes and operation ... each aspect has to be thoroughly considered," he said.

Responding to the Liberal Party's call to develop casinos on Lantau, Mr Arculli, formerly the party's vice-chairman, believed there would be huge resistance from education and religious groups.

"I don't think we need casinos from a taxation point of view. But for the sake of tourism and Hong Kong's status as a financial centre, having casinos would make us more attractive," he said.

Mr Arculli said if the government went ahead with such a plan, the Jockey Club should be allowed to run the business on a non-profit basis.

February 21, 2005

Wednesday, February 23, 2005
By Craig Karmin, The Wall Street Journal

Global investors are placing a big bet on Chinese gambling.

Shares of Las Vegas Sands Corp., which operates a lucrative casino in China's Macau territory, have soared 64 percent on the New York Stock Exchange since the company's initial public offering of stock in December. Wynn Resorts Ltd., which is poised to open its own Macau casino in 2006, has jumped 105 percent over the past 52 weeks in Nasdaq Stock Market trading.

But money managers eager to double down their bets are playing two Chinese companies with the most direct exposure to Macau's gambling, hotels, transportation and tourism: Shun Tak Holdings and Melco International Development. Both stocks are listed only in Hong Kong, but U.S. investors can buy them through certain brokers, usually with an additional fee.

Analysts say it is only a matter of time until Macau surpasses Las Vegas as the world's largest and most-profitable gambling and convention center. The former Portuguese colony is just 40 miles from Hong Kong and is the only place on mainland China where casinos are permitted.

"This is a real long-term growth story," says Alexander Muromcew, portfolio manager with TIAA-CREF. The big pension fund -- formally known as Teachers Insurance and Annuity Association-College Retirement Equities Fund _ owns shares of Shun Tak, Melco, and Far East Consortium, a Hong Kong-based property company that is developing Macau casinos.

With Chinese enthusiasm for gambling and the territory's boomtown prospects, there is little doubt these stocks offer a chance to hit the jackpot. But since these stocks already have had a big run and with questions over investor protections _ the odds may be longer than many investors think.

There already are concerns about overdevelopment as new operators rush in hoping to lure the world's high-rollers, many of them Asians, away from Las Vegas. Goldman Sachs warns that the number of Macau gambling tables is poised to rise to 3,700 by 2008 from 845 at the end of last year. That compares with about 2,500 tables currently on the Las Vegas strip. "If demand fails to meet the new supply, this could lead to declining returns in Macau's gaming sector," Goldman says.

Merrill Lynch, meanwhile, forecasts that 2004 gambling revenue was $5.2 billion in Macau, an increase of nearly 50 percent over the previous year. That compares with about $5.3 billion in revenue last year for the casinos along the Las Vegas strip. Macau's gamblers also are skewed decidedly toward high-stakes games like baccarat, while Las Vegas gamblers lean toward slot machines and other mass-market games, such as blackjack and roulette.

Investors also have raised concerns about the treatment of minority shareholder rights and, more seriously, over lingering crime and corruption. Last year, a Macau casino operated by longtime gambling kingpin Stanley Ho faced media allegations of a money-laundering plot that enabled mainland tourists to circumvent currency-exchange limits on people leaving China. Mr. Ho has denied any wrongdoing.

Foreign investors know that many of China's most-promising stocks have faltered on unforeseen difficulties or problems with management. And for all of China's vast potential, few fund managers have been able to translate the country's rapid economic growth into profitable investments. Some already are skeptical about the relative value of the gambling sector.

"In an industry where there is a history of underreported earnings, these stocks are risky plays," says Constance Hunter, managing partner at Coronat Capital Management, a New York-based hedge fund, which doesn't have any holdings in Macau. "There are a lot of other China investments that look less risky."

Still, even skeptics acknowledge that Macau has evolved significantly over the past few years.

The Portuguese legalized gambling there in the 19th century, and the territory was returned to Beijing in 1999. Gambling had long run as a government-sanctioned monopoly until 2002, when the Macau government liberalized the industry by awarding three licenses.

One license went to a group run by the 83-year-old Mr. Ho, who controls Shun Tak and whose son, Lawrence Ho, 28, is chief executive of Melco. Another license went to Galaxy Casino Co., a joint venture between Hong Kong investors and Las Vegas Sands. The third went to Wynn Resorts. Additional licenses may be granted in the future.

"We believe we have the potential to earn more out of Macau than from Las Vegas," says William Weidner, president and chief operating officer for Las Vegas Sands, which plans to open a second beachhead in Macau, a resort on the territory's Cotai strip, by 2007.

In 4 p.m. composite trading on the Big Board, shares of Las Vegas Sands fell $1.43, or 2.9 percent to $47.62, giving the company a market capitalization of $17.2 billion. In Nasdaq Stock Market 4 p.m. composite trading, the stock of Wynn Resorts, which has a market value of $7.13 billion, fell 3.5 percent, or $2.57, to $70.17.

Shun Tak is the center of it all. While it operates multiple businesses, including many in Hong Kong, Goldman Sachs estimates that its property, transportation, gambling and hotel assets in Macau should account for 88 percent of its net profits by the end of 2008, up from only 30 percent in 2004.

Tourism from mainland China to the territory also is soaring, up to 9.5 million visitors last year, more than four times the number in 2000.

Melco is expected to see gross gambling revenue at its high-end Park Hyatt casino jump to $300 billion in 2009 from $140 billion in 2003, according to Smith Barney.

The brokerage firm also expects Melco to make a bid for a gambling license in Singapore and sees another potential investment in Cotai, an area of Macau that is expected to develop into a Las Vegas-style strip.

But before Macau emerges as the world's pre-eminent gambling center, these stocks could face selling pressure. "The proliferation of the Macau concept is reminiscent of the (technology-media-telecom- munications) bubble" of the late 1990s, Smith Barney says in a report. The brokerage firm rates Melco a "hold" but with a price target of 20 Hong Kong dollars ($2.56).

Following huge gains last year, both stocks have been highly volatile and 3 percent to 5 percent daily moves are common. Shun Tak shares surged 195 percent in 2004, while Melco jumped to HK$19.70 from HK$1.97, though both are down slightly this year.

Shun Tak's shares were unchanged Tuesday on the Hong Kong Stock Exchange at HK$8.25, while Melco fell 1.7 percent to HK$17.55.

As with other family-run Asian conglomerates, minority shareholders often come up on the short end of the stick.

In 2002, Shun Tak offered a rights issue that enabled three of Mr. Ho's daughters, who also were Shun Tak directors, to increase their stake in the company to 11.3 percent from 1.6 percent at a significant discount to its net asset value. Other shareholders weren't given the same opportunity.

By Catholic News Service

MACAU (CNS) -- Three months before his graduation, Ah Wai quit school and abandoned plans to become a social worker in favor of dealing cards at a newly opened casino in Macau.

In January, the 23-year-old Macau resident was promoted to manager; he now monitors operations at gambling tables in the casino, reported UCA News, an Asian church news agency based in Thailand.

"My parents have been unemployed for a long time, and I have a mentally disabled younger brother to look after," Ah told UCA News. "Although I would like to pursue studies in social work, relatives and friends have urged me to take up a job with high pay to improve my family's income."

Macao, a special administrative region of China, has 17 casinos, and more are planned. As the "Monte Carlo of the Orient" continues to add casinos, church officials expressed concern that students may be sacrificing their future and long-term security by forgoing their education for the quick cash provided by casino jobs.

Choi Chi-u, principal of Jesuit-run Star of the Sea College, warned that this phenomenon is having negative effects on the character of local students, who end up with a skewed vision of what money means.

Young casino workers see money changing hands quickly, with gamblers wagering tens of thousands of dollars at a time. They may think money is a means of entertainment, Choi said.

"Compared with the gamblers' stakes, employees may feel their salaries too small, and that would arouse a pressing desire to earn fast money," he said.

The nature of a dealer's work is monotonous, and the training he or she receives deals merely with techniques for table operations, Choi said. Also, the shift system effectively keeps casino employees from pursuing formal studies at the same time, he added.

But casino workers receive salaries higher than those otherwise available in Macau for the same skill level. A dealer's monthly salary is about $1,500-$1,900, almost equivalent to that of a junior civil servant, who is required to have a university education. Casinos also provide all necessary training, which attracts young people without much work experience or higher education.

Salesian Father Peter Pong Ping-fai, chairman of the Catholic Schools Council in Macau and a school principal, said he advises young job seekers to consider more than just the salary a job offers. He asks them to also consider aspects such as job satisfaction, the possibility to exercise one's potential and the meaningfulness of the work.

Father Joao Evangelista Lau Him-sang, parish priest at Cathedral of the Nativity of Our Lady, said the church should draw up a plan for providing pastoral care to those working in the gaming industry. Even people who are not Catholics have approached the church for spiritual support and guidance, he said.

The church can help people maintain a proper attitude toward the gaming industry and its employees, he said.

"As long as we stay rational and responsible, entertainment is good for a person and acceptable to the church," the priest said.

"The church should witness and emphasize one's outlook of life, morality and responsibility to get rid of temptations and addiction," he said.

Kou Cheng-un, a teacher and career counselor with a Catholic secondary school, said some students have quit school, giving up the hope of studying in universities, after securing casino jobs.

"Once, a parent came to school to seek permission to allow his daughter to drop out right before the preliminary school finishing examination so that she could take up a dealers' training course," Kou said.

The minimum age for employment in Macau is 16, but casinos hire people in the 18-35 age range. They first screen candidates, sending those who pass for a six-month training course, followed by a formal recruitment test. Those attending the training are given an allowance.

Choi said his school has responded by seeking to strengthen morality through religious studies and life education, teaching students that the pursuit of wealth is not a proper basis for a value system.

Closer teacher-student relations would enable teachers to be more sensitive to students' psychological condition and provide needed counseling, Choi said. He recommended that schools encourage students to participate in activities and volunteer work to understand that work not only satisfies personal wants but also serves others.

Ah said that, despite the good pay, working in a casino has a down side.

"Working in this U.S.-invested casino is meaningless to me, except for the good income. I seldom have a chance to talk to colleagues or build friendships with them. The top management is filled with foreigners, making me and other local staff members feel inferior," he said.

Moreover, the job "does not provide a written contract," he said, expressing fear that he would have trouble defending himself "in the case of a labor dispute."

Asked about plans for the future, he said he had none.

MACAO, March 4 (Xinhuanet) -- A senior executive with the Wynn Resorts (Macao) expelled worried that the parent company's involvement in Singapore's casino bidding would hinder its investment plan in Macao.

Friday's Macao Daily quoted Grant Bowie, President and General Manager of the Wynn Resort (Macao), as saying that the company considered that Singapore's latest endeavor to introduce a casino would have no impact on Macao's gaming industry.

He said that the Wynn Resort (Macao) has started employment. The company will organize a big job fair by the end of the year hoping to recruit some 4,000 people to meet the demand for the launch of its business.

The US casino mogul Steve Wynn announced his plan for a 705 million-US dollars worth Las Vegas-style resort in Macao last year.

Bowie held that Macao has laid a solid foundation of the gaming industry. In the next two or three years, there will be several casinos and entertainment groups coming off stream.

Bowie disclosed that the company is still looking for other investment projects in Macao. He considered that the parent company would reinforce its confidence in expanding investment in the Asian region if it won the bidding in Singapore.

Bowie has more than 20 years of industry experience. He had previously managed Australia's Conrad Jupiters and Treasury casinos.

Casinos give Macau coffers 30pc boost
Mark Lee, Hong Kong Standard
March 7, 2005

Macau's mushrooming casino industry pushed up the territory's gaming revenues by 30.1 percent in 2004 to 38.6 billion patacas (HK$38.09 billion), according to figures released Sunday by the Macau government, creating a record government budget surplus.

Mainland tourist arrivals to the gambling mecca skyrocketed by 66 percent in 2004, contributing 27 billion patacas to the economy, making mainlanders the highest spending visitors, averaging nearly three times higher than visitors from Hong Kong, who spent on average 1,000 patacas each.

Turnover from casinos is expected to account for about 95 percent of gaming revenues.

The rest comes from horse racing and lotteries. This would catapult Macau's casino market to second place behind only Las Vegas in terms of size, overtaking Atlantic City, assuming Atlantic City did not grow significantly from 2003 when it took in US$4.5 billion (HK$35.1 billion).

Last year, Macau's casino industry benefited from new players in direct competition with the Sociedade de Jogos de Macau (SJM), which had previously monopolized the sector.

The government broke up SJM's monopoly by granting casino concessions to US casino operator Wynn Resorts and Hong Kong-based Galaxy Resorts in addition to SJM.

The concession holders could in turn sub-license other operators to set up and run new casinos.

US casino operator Las Vegas Sands opened the Sands Macau last May, the first non-SJM operated casino there, after obtaining a sub-concession from Galaxy. Galaxy later opened Galaxy Waldo in July. SJM opened its Greek Mythology in December, to add to the 12 casinos it already operates and opened two more earlier this year.

While SJM is expected to continue to dominate the sector, the entry of new operators has added considerable impetus to its development, analysts said.

"The potential of the casino industry in Macau could be astronomical," said a lawyer who has been advising firms entering the industry. "The potential comes from the high number of people with substantial wealth, with a high propensity to gamble who live in the vicinity of Macau."

The lawyer said the casinos are increasingly catering for mass-market punters, moving away from a reliance on high-stakes gamblers.

"Casinos that operate this business model, such as Sands Macau, are also proving to be highly profitable," the lawyer continued. "Sands Macau managed to break even seven or eight months after opening in May last year."

An academic from the University of Macau, Davis Fong, predicted in a study last year that VIP baccarat play would contribute about 60 percent of the casinos' revenues in 2004, declining from 78 percent in 2003, as tourists take over from high net-worth gamblers as the main drivers of the industry's growth. Such a move is likely to suit Macau's gaming industry as the central government has recently launched a series of crackdowns on money laundering, as well as banning members of the Communist Party from gaming tables.

In 2004 the industry generated tax income of 14.7 billion patacas, representing nearly 70 percent of total tax receipts in the fiscal year ended December, helping it achieve a record budget surplus of 6.2 billion patacas.

9/3/2005 15:16

The education authority in China's Macau Special Administrative Region (SAR) has found that 624 students left school to pursue high-paid jobs in casinos last year.
Macau Post Wednesday quoted Sou Chio Fai, director of the Education and Youth Affairs Bureau as saying that the number signified the most serious school dropout phenomenon in the past seven years.
In the 2003-2004 school term, Macau has 98,255 students on campus. The bureau's investigation found that a total of 4,908 students left school in that term, and some 80 percent of them were aged 16 or over. Nearly half of the school dropouts have found jobs in the gaming or catering sectors.
Sou said that the bureau would do its best to persuade students to complete their school education before entering the job market.
There are currently 17 casinos in Macau, and more are under construction, which would offer thousands of jobs in the next two years. Students are wooed by the fast-earning jobs in the sector.
The gaming industry has existed in Macau for over 100 years. The industry has sustained its vigor after Macau returned to China in 1999, which has been guaranteed by the principle of "one country, two systems." As the only place in China, where gambling is legal, Macau liberalized the sector for overseas investment in 2002, and designated it as the city's economic backbone.

Zach Coleman


March 10, 2005


The Sands Macau casino's push into the lucrative high-stakes baccarat market is producing returns already, company executives said Wednesday.

Gamblers bought US$144 million (HK$1.12 billion) worth of chips to play on the Sands' high-limit tables between October and December, more than triple the US$45 million bought there between July and September, said Brad Stone, executive vice-president of parent company Las Vegas Sands during a conference call with analysts.

``We expect this market to start showing meaningful increases in gaming volumes in the second half of this current quarter,'' he said. This is because the casino this month raised its commission rates to snare more big-time gamblers, as reported by The Standard last week.

Las Vegas Sands president and chief operating officer William Weidner said that already this year the Sands has linked up with four junket agents, adding to the two it partnered with at the end of last year.

High-stakes baccarat traditionally accounts for most of the revenue generated by Macau's casinos.

The Sands has entered the competition for high rollers gradually out of concern about disreputable junket agents who could affect Las Vegas Sands' standing with United States regulators.

Weidner said some high rollers avoided Macau during the Lunar New Year holiday to avoid crowds.

``Our traffic counts were the lowest we've ever seen in the first few days'' of the holiday, he said. ``Then we went from record low attendance to record high attendance in a matter of two days.''

Weidner said Las Vegas Sands had replaced Thuy Thinh with Frank McFadden as its senior executive in Macau late last year because the company wanted a ``more aggressive style'' of management and an executive with a wider spread of international experience and greater seniority to direct the move into the VIP market and the development of the company's next Macau projects.

Next up is the Venetian Macau casino resort, which Stone said should open in late March 2007.

He said reclamation work for the project, set for the new Cotai area between Taipa and Coloane islands, is complete.

Chief financial officer Scott Henry said the company is exploring raising funds for the US$1.8 billion project in Macau but does not expect to take out new loans until the end of the year.

Weidner said Macau has approved Las Vegas Sands' plans for the area around the Venetian, which it calls the Cotai Strip.

Firms interested in building resorts there that would house Las Vegas Sands-operated casinos have signed up for six sites. Weidner said the approved plan encompasses 11,500 hotel rooms.

Weidner also confirmed, as The Standard reported on Wednesday, that there are plans to expand Sands Macau, but dodged a question on details.

Stone said bettors at the Sands' public gaming tables actually bought US$45 million fewer chips in the fourth quarter of 2004, which Weidner implied may have been partly due to gamblers checking out newly opened casinos.

He is confident these gamblers will soon return.

``We'll see the market go into places like Greek Mythology, Golden Dragon, and a couple of the other conversions of ballrooms, lobbies, [and] broom closets,'' he said. ``The new places that have opened and the new capacity that's been added is inferior by a long shot to what it is that we have.''

Regal joins Venetian in Macau hotel venture
Gladys Tang, Hong Kong Standard
March 14, 2005

Regal Hotels International has unveiled plans to team up with United States-based casino operator Venetian to develop a hotel project in Macau.

An announcement on the deal, which had been rumored for months, came at the weekend after the two parties signed an agreement to develop a hotel project with gross floor area of 3.4 million square feet in a resort at Cotai, according to a statement to the Hong Kong stock exchange.

The project, which includes hotels, casinos, entertainment and conference facilities, will be built in two stages.

Phase one consists of a 1,500-room hotel with catering, casinos and shops.

Construction of phase one will begin later this year and it is expected to be completed by 2007, Regal said.

Phase two consists of a hotel with no less than 1,500 rooms with an extension for a casino and a shopping mall.

The Hong Kong-listed hotel operator, which owns five hotels in Hong Kong, said the project could help improve the company's prospects.

It did not disclose the investment amount, although executive director Donald Fan earlier said it had planned to put in HK$1 billion to HK$2 billion for construction.

Companies are rushing to invest in Macau, betting on its potential growth driven by casino business and tourism.

Pearl Oriental Enterprises bought a 40 percent stake in Golden Dragon, Macau's newest casino, for HK$514 million in January.

Regal is also poised to expand its presence in Hong Kong to meet the tourist demand and has set aside HK$100 million to expand its four-star Regal Riverside Hotel in Sha Tin to as many as 1,080 rooms from the current 830 and enlarge the 425-room Regal Hongkong Hotel in Causeway Bay by 50 to 60 rooms.

Pearl Oriental to go ahead with Golden Dragon buy
Zach Coleman, Hong Kong Standard
March 15, 2005

With Macau's booming gambling market spurring on an investor frenzy, Hong Kong-listed Pearl Oriental Enterprises is plowing ahead with a half-billion-dollar Macau casino hotel investment despite encountering a financial black hole.

Pearl Oriental said Monday it will move ahead with its planned acquisition of a 40 percent stake in the new Hotel Golden Dragon even though it has been able to get a look at only the past year's books for the company that owns the hotel.

That company, founded in 1990, was owned by the Fujian province finance department until last March.

Pearl Oriental is not alone in taking a gamble.

Regal Hotels International director Donald Fan said Monday his company will invest HK$2 billion-HK$2.6 billion to build a 3,900-room resort in the "Cotai Strip" development directed by American casino operator Las Vegas Sands.

Fan did not give the terms of the deal with Sands, which will operate a casino and convention facilities inside the resort, but predicted Regal will earn a full return on its investment within four years of its 2007 opening.

Regal, which struggled under a mountain of debt until a restructuring deal last year, said it will fund the project from internal sources.

The first phase of the two-stage project will include 1,690 guest rooms.

In an interview in the new issue of China Business Review, Las Vegas Sands president and chief operating officer William Weidner said besides Regal, the Cotai Strip will feature resorts under the Four Seasons, Marriott International's Renaissance and InterContinental Hotels Group's Holiday Inn brands.

In a circular sent to shareholders Monday, Pearl Oriental's board said it viewed the risk in investing in Golden Dragon without a full look at its records to be acceptable and outweighed by potential returns, especially since the businessmen who are selling shares to Pearl Oriental have agreed to indemnify it against any hidden liabilities.

The businessmen have also guaranteed that Golden Dragon's annual net profit for the next three years will be at least HK$200 million or they will make up the difference.

They pledged once Golden Dragon repays HK$179.5 million in loans, at least 70 percent of profits will be paid out in dividends.

Pearl Oriental, however, has decided to hedge its investment a bit.

The company said previously Golden Dragon would collect 40 percent of casino gross profits, but now Golden Dragon will receive 24 percent of the profits and HK$26.4 million a year in rent via a marketing joint venture with Golden Dragon chairman Chan Meng-kam. Pearl Oriental said the deal "will be of great benefit to the business of the gaming casino" because of Chan's experience in recruiting high rollers from Fujian.

The circular includes an independent valuation on the Golden Dragon, appraising the hotel's worth at HK$1.65 billion.

The Fujian finance department sold the then-unfinished hotel last year for HK$281 million.

The hotel has regularly filled 85 percent of its rooms since its opening two months ago, the circular said.

The casino, run by Sociedade de Jogos de Macau, includes 80 public gaming tables, 107 slot machines and six VIP rooms, which together hold 15 more tables.

Ernest Kong

Regal Hotels International plans to double the number of hotel rooms in its portfolio to 8,000 with a $ 2 billion complex in Macau that will include a casino and an opera house.

The ambitious project, a 3,900-room hotel in the territory's Cotai resort area, was disclosed only five months after the Hong Kong-listed firm's chairman, Lo Yuk-sui, ended a debt-restructuring programme that spanned seven years and three companies.

Executive director Donald Fan Tung said the 3.4-million-square-foot project, to be developed in two phases, would comprise a 170,000 sqft casino and an opera house, both of which will be leased by Las Vegas-based casino operator Venetian Group.

"The development will be funded by internal resources and bank finance," said Mr Fan, adding the investment would correspond with the construction progress, which could take less than four years.

Mr Fan said the hotelier, which manages five hotels in Hong Kong and two in Shanghai, would not be involved in the gaming business. He would not comment on the details of the agreement nor explain how the hotelier would secure rental income.

Regal Hotels executive director Poman Lo said: "Macau is the only resort destination in the whole of China for gaming ."

Mr Fan said: "We have signed a memorandum of agreement. We are prohibited to disclose the details of the lease at the moment."

According to a company announcement released on Sunday, the memorandum is not legally binding and the agreement is not yet finalised.

Mr Fan said construction of the project's first phase, comprising 1,690 rooms, would begin by the end of this year. A decision over the remaining 2,210 rooms would depend on the success of that phase.

"The first phase of the project will start bringing us net operation profit in 2008," said Mr Fan, who expected about $ 300 million in operational profit in the first year from a room rate of about $ 600 to $ 650 per day.

"The room rate is similar to hotels in Hong Kong but the land cost and operation costs are much cheaper," said Mr Fan, who would not say how much was paid for the land.

At the height of Mr Lo's financial problems, his firms - Century City International Holdings, Paliburg Holdings and Regal Hotels - struggled with about $ 14.8 billion debt.

In October last year, Mr Lo agreed to a $ 1.79 billion debt-restructuring programme for Century City with creditors.

MACAU: American gaming giant Sands was to unveil Friday plans for a new hotel and gambling complex that will set Asian gambling haven Macau on the road to becoming the world's biggest casino attraction.

Sands was to lift the covers off details of its Macau Venetian resort, an almost identical replica of its famous hotel and casino namesake in Las Vegas.

The leisure centre, which will include conference and entertainment facilities, will be the first of some 25 new casinos and resorts due to be built in the former Portuguese enclave, ruled by China since 1999.

Sands, the largest casino operator in Las Vegas, has spearheaded a revolution in Macau's once ailing gambling industry.

The opening of Sands Macau, a precursor casino, in May last year brought American-style glitz and pizzazz to an industry once marked by seedy and smoky, crime-ridden gambling dens.

Coinciding with a huge spike in tourists from mainland China, Sands helped transform the once-sleepy enclave, long Asia's premier gaming haven, and produce double-digit economic growth.

Income from the city's dozen or so casinos is expected this year to eclipse the seven billion US dollars earned by Las Vegas last year.

Success has come at a cost. The territory, with a workforce of just 250,000, is already feeling a labour crunch as the mushrooming casinos drain the labour pool.

The influx of tourists has also stretched the city's transport infrastructure to snapping point.

March 18 (Bloomberg) -- InterContinental Hotels Group Plc, Four Seasons Hotels Inc. and Marriott International Inc. will join Las Vegas Sands Corp. in the development of a $12 billion Vegas-themed gambling strip in southern China's Macau.

``What Asia needs is an Asian Las Vegas,'' Sands Chairman Sheldon Adelson, 71 said today in Macau as he unveiled the $1.8 billion first phase, which includes seven casino-hotels. Four Seasons, Marriott, InterContinental and four other global hotel groups will be among a group of investors bearing 83 percent of the cost, Adelson said.

Regal Hotels International Holdings Ltd. will join Sands to construct the Venetian Macau, Adelson's second casino hotel in the former Portuguese colony, the only place in China where casino gambling is legal. Macau's gaming revenue may match that of Las Vegas by 2008, said analyst Jonathan Galaviz.

``Las Vegas, as a model, has shown that when you increase supply of entertainment, you inherently increase macro-demand for the destination,'' said Galaviz, a partner at Las Vegas-based equity research company Galaviz, Ong & Co. Adelson's vision to replicate Las Vegas in Asia is ``achievable.''

In Macau today, Adelson was joined at a briefing by hotel executives including Michael Evans, vice president for Asian hotels at Marriott International, the largest U.S. hotel company; and Matthew Fry and Stephen Ho, vice presidents for acquisitions at Starwood Hotels & Resorts Worldwide Inc., the No. 2 U.S. hotel company.

The hotel executives declined to comment on their plans for Macau's Cotai, a stretch of reclaimed land in about the size of two football stadiums. Adelson aims to fill Cotai in seven to 10 years with casino resorts providing 60,000 rooms.

`Untapped Segment'

The Venetian, which will be bigger than the $240 million Sands Macau that opened last May in downtown, will be sited on Cotai. The new resort will provide 3,000 suites, about three- quarters of the size of the Las Vegas Venetian, which has some of the most expensive room rates in that city.

Hotels in Macau should be able to develop ``an untapped segment of the market,'' said Eric Wong, an analyst at UBS Securities Asia Ltd. in Hong Kong. ``All you need is for the current Macau visitor to stay longer, rather than just the typical middle-aged male going there to gamble.''

Regal Hotels said this week that it signed an agreement with a unit of Sands to build a hotel in Macau. The first phase of the project will be a 1,500 room hotel to be run by Regal and a casino and convention center run by Sands unit Venetian Group, Regal said in a Hong Kong stock exchange statement on March 14.

Manuel Joaquim das Neves, director of the Macau Gaming Control Board, estimated more than 20 casinos will be operating by 2007 in Macau. Tax revenue from gambling made up about a third of the city's economy in 2003 as more visitors from neighboring China gambled in the city after the Chinese government eased travel rules.

Singapore May Compete

Chinese personal incomes rose last year as surging Chinese trade pushed the mainland's economic growth to 9.5 percent. Per capita disposable income in China's urban areas, home to a third of the nation's 1.3 billion people, rose 7.7 percent to an inflation-adjusted 9,422 yuan ($1,138) last year.

In Las Vegas, the four-mile Strip is filled with almost two dozen casinos, two-thirds of which are run by Sands' larger rivals Harrah's Entertainment Inc. and MGM Mirage. The city of Las Vegas had about $8 billion in gross gambling revenue last year, compared with $4 billion in Macau, Galaviz estimates.

Singapore is considering whether to legalize casino gambling and has invited proposals for a casino resort. Sands and 18 other companies have submitted offers, aiming to tap some of the $13 billion in legal gambling revenue generated last year in Asia. Galaviz projects Asia may generate $24 billion in legal gaming revenue by 2007, up 85 percent from 2004.

`Big Investment'

Adelson and Wynn Resorts Inc., the casino company led by rival Stephen Wynn, aim to tap the imagination of the Chinese by decorating their casino resorts with fake volcanoes and mock Roman amphitheaters. Wynn is building the Wynn Macau, set to open in 2006.

Sands President William P. Weidner said today the company was sticking with its forecast that the Sands Macau will become profitable after its first year.

``It is, after all, a big investment,'' he said.

Macau has 15 casinos, 13 of which are run by Hong Kong-born Stanley Ho, who held a 42-year gambling monopoly until 2002. Ho has no participation in Cotai, Adelson said.

``Stanley Ho has other casinos to protect,'' Adelson said ``If I were him, I would protect them.''

By MarketWatch
Last Update: 5:28 AM ET March 18, 2005

TOKYO (MarketWatch) -- Las Vegas Sands president and chief operating officer Bill Weidner said Macau gaming revenue should reach $6 billion this year, according to a published report.

The U.S. gaming giant has unveiled plans for a $1.8 billion casino complex in the former Portuguese colony near Hong Kong. Its Macau Venetian resort, unveiled Friday, is an almost identical replica of its famous namesake hotel and casino in Las Vegas.

Weidner believes that gambling earnings in Macau will grow 20 percent per year for the foreseeable future, after posting a record $5 billion last year, and eventually outstrip the $9 billion Nevada State casinos pull in each year, AFX-Asia reported.

The U.S. firm is among half a dozen or so major hotel groups that have signed on to open properties on the Cotai Strip, a 100,000-square-meter offshore reclamation site.

18/3/2005 15:14

Tycoon Stanley Ho Hung Sun's Macau Tourism and Amusement Company (STDM) earned 3 billion patacas (US$375 million) in profits last year, up 20 percent year-on- year, Macau Daily reported Friday.
The parent company of the Macau Gaming Co Ltd (SJM) attributed the rosy yearly payoff to the sound economic performance and a booming gaming-tourist industry.
Stanley Ho held a 40-year monopoly of Macau's gaming market through STDM till 2002, which still retains 80 percent of the shares in SJM. STDM's revenue was mainly reaped from the gaming and real estate sectors.
SJM turned 13 billion patacas (US$1.6 billion), or some 35 percent of its gross revenue, to the government's tax coffer last year, up 18 percent from the previous year.

By Dominic Whiting

MACAU (Reuters) - Hoping a new Las Vegas will rise from the sea off the southern tip of China, multi-billionaire gaming tycoon Sheldon Adelson has unveiled his "dream" plans for a strip of casinos, plush hotels and shopping malls in Macau costing up to $15 billion (7.8 billion pounds).

The world's 19th richest person, who flies from the United States to the former Portuguese enclave of Macau in his private jet once a month, said his planned Cotai Strip project would give Asia its first "neon alley" entertainment venue.

A former Portuguese colony handed back to Beijing in 1999, Macau is the only place in China where casino gambling is legal.

Flanked by executives from investing hotel operators including Hilton Group's Hilton International, Marriott International and Four Seasons Hotels Inc., Adelson told reporters the three-phase development would feature 60,000 rooms in seven casino hotels.

By comparison, Las Vegas has 130,000 hotel rooms.

The centrepiece of Adelson's vision is the $1.8 billion Venetian Macau, to be built by Adelson's Las Vegas Sands Corporation, a copy of the themed casino, conference and entertainment complex of the same name in Las Vegas.

"I had a dream one night. All of a sudden it came to me. There's room there and demand to create Asia's Las Vegas," Adelson, 71, told a packed news conference on Friday, as masked waitresses in sixteenth century Venetian costumes served champagne.

A model of the planned complex showed palm-lined avenues, gondoliers floating on canals and a dozen high-rise buildings.

PROPPING UP THE STRIP

A 10-minute drive away from the news conference, across a snaking bridge, construction workers hammer 14,000 piles into 4.7 square km (1.8 sq mile) of reclaimed land that has forged two of Macau's islands into one.

Steel and concrete pipes lie beside fields of dust, as trucks drive over a bridge from mainland China to unload earth under the gaze of giant statues of mythical goats.

The first phase of the project, to be completed in 2007, will include 10,000 hotel rooms, plus the Venetian's 3,000 suites, a 15,000-seat arena and 80,000 sq metres (850,000 sq ft) of shops.

"The mainland could send so many people that, if there were no piling, they would sink the strip," Adelson said of the voracious appetite for gambling in China.

Mainland Chinese visitors have thronged once-sleepy Macau since Beijing eased travel restrictions for its citizens two years ago. New investment, meanwhile, has poured in since Macau ended tycoon Stanley Ho's gaming monopoly in 2002.

Last year, Macau welcomed 16.7 million visitors, up 40 percent on 2003, which pumped up economic growth by 30 percent. Just over half were from mainland China.

Property prices have jumped 50 percent in the last year. Developers are rushing to build luxury flats to feed the Macau investment fever that has infused Hong Kong, an hour away by ferry or 10 minutes for those who can afford a helicopter ride.

A plush 1,000-square foot flat now costs about HK$2.2 million (US$282,051) -- still just a fifth of Hong Kong's prices.

PACKED TABLES

Macau's 16 casinos are booming.

In Adelson's one existing Macau casino, the 10-month old Sands, every baccarat table was surrounded by about a dozen gamblers at midday on Friday, mostly from the mainland.

According to CSFB, the legal gambling business raked in HK$40 billion in "total net wins" last year, up nearly half on 2003.

Analyst Gabriel Chan estimates gaming tables will double to around 4,000 by 2009, with about 600 reserved for VIPs and their high-stakes gambling. Based on 18 years of business, each "high roller" table is worth HK$841 million to a casino, Chan figures.

Although some of the older casinos with crumbling facades could lose ground to the glitzy newcomers, U.S. operators such as Adelson and his Las Vegas rival, Steve Wynn, might find it hard to compete for mainland business.

Many of the highest rollers in Macau are brought by tour operators who lend money and collect debts back in the mainland.

"The Americans still do not have the necessary connections," CSFB's Chan said in recent a note to clients.

Macau could also face increased competition for gamblers in Asia, with Singapore considering building a casino. Las Vegas Sands is reportedly interested in operating in Singapore.

Adelson was in a battling mood when asked whether local competitor Ho, who long held Macau's only gaming license, would invest in the Cotai Strip.

"He's not participating," Adelson said. "If I were him I'd concentrate on protecting his casinos."

March 22, 2005 - 5:34PM

Australia's richest man and most famous gambler, Kerry Packer, has increased his foothold in the lucrative gaming haven of Macau.

Mr Packer's Publishing and Broadcasting Ltd and its joint venture partner Melco International Development Ltd have boosted their stake in a company that will build and own a new hotel and casino in Macau.

The 50:50 partners said on Tuesday their joint venture vehicle would buy the remaining 30 per cent it did not already own of Great Wonders Investments Ltd for about $65 million.

"The purchase price to be paid for by the joint venture is $HK400 million (approximately $65 million) and will be met from the existing funds of the joint venture," PBL said.

Last year, PBL teamed up with Melco, a company controlled by the family of Asian casino tycoon Stanley Ho, to expand their gaming interests in Asia, Australia and New Zealand.

Their joint venture's first project was the purchase of 70 per cent of Great Wonders which is building the hotel and casino on the island of Taipa, about 10 minutes drive from Macau via a bridge.

The pair plan to expand further in Asia with Melco to hold 60 per cent of any opportunities in Greater China, while PBL will get 60 per cent and Melco 40 per cent of opportunities elsewhere in Asia.

Macau, the only part of China where casinos are legal, has grown into one of the largest gaming markets in the world since additional gaming licences were granted four years ago.

CSFB analysts said in a research note the total net win of Macau's gaming industry was growing at a rate of 40 per cent a year with no sign of slowing.

PBL's executive chairman James Packer recently told analysts the joint venture was also bidding for one of two licences to build and operate a casino in Singapore.

CommSec analyst Olivia Cartwright said the announcement on Tuesday showed the joint venture was moving forward although it would be sometime before its success could be gauged.

"It's just another step in consummating the joint venture relationship," Ms Cartwright said.

Shaw Stockbroking analyst Greg Fraser said the joint venture's success would depend on what they can secure in terms of contracts.

"The Singapore one is the first off the block but there is fierce international competition for that," Mr Fraser said.

PBL's shares closed 12 cents lower at $16.07 on Tuesday.

Casino and gaming industry news provided by Financial News USA (OTC: FNWU). U.S. casino operator Las Vegas Sands Corp. (NYSE: LVS) announced Friday it has teamed up with seven major hotel chains to develop what it called an Asian version of the Las Vegas Strip in the southern Chinese gambling enclave of Macau. Magna Entertainment Corp. (Nasdaq: MECA) announced that it has appointed Former Massachusetts Governor and United States Ambassador to Canada Paul Cellucci as its Executive Vice-President of Corporate Development effective May 1, 2005.

Diamond I, Inc. (formerly AirRover Wi-Fi Corp.) (OTCBB: DMOI), a Wi-Fi-based communications solutions company, today announced that it has hired Alex Davis as Vice President of Corporate Development. Mr. Davis will assume his position with Diamond I immediately. Boyd Gaming Corporation (NYSE: BYD) management presented at the Lehman Brothers 2005 High Yield Bond and Syndicated Loan Conference in Orlando, Florida.

Zach Coleman


March 25, 2005


Otis Elevator International has won a HK$20 million contract to supply elevators and escalators for the Wynn Macau casino hotel, continuing its dominance in the trade of moving people through the territory's major landmarks.

Otis will supply two escalators and 33 elevators of various types to Leighton Contractors which, together with China State Construction Engineering, is building the HK$5.5 billion gaming palace behind the Hotel Lisboa.

Wynn Macau is set to open by September next year with 400 guest rooms and 200 suites. The elevators will be used to provide separate entrances for the public, suite guests and high rollers.

Although this contract marks Otis' first entry into a casino developed by Steve Wynn, area director Ray White said the United States-based manufacturer's systems operate in the Bank of China building, the Macau Tower, Hotel Lisboa, the Hong Kong ferry terminal and the airport.

Otis employs about 40 staff in Macau. The company is likely to add two technicians to the team once the 23-story Wynn Macau is operating and White said he sees pressure mounting to raise salaries to retain employees.

He expects Macau to introduce regulations next year to require registration of elevator installation and maintenance companies as is typical in developed markets like Hong Kong. ``It's quite a laissez-faire arrangement right now,'' he said.

Demand for elevators in Macau outstrips that of Hong Kong, White said. At least a half dozen more large contracts are out for bid now in Macau as its low-rise developments give way to 20- and 30-story towers.

MACAO – As reported by the China Daily: "In a meeting room in the heart of Sands Casino, Paul Steelman, president and CEO of Paul Steelman Design Group (PSDG), beams at the prospects that lie ahead. The chief architect for the recently opened Sands has arrived in Macao to inspect recent additions to the building he designed and to address a group of fellow architects, among them leading names like Callisons and KPF (Kohn Pederson and Fox), who are eager to hear about the success of his latest project.

"And well they might. Steelman is one of the world's leading casino designers, having worked on over 80 casino and entertainment related projects in a career that spans nearly thirty years. The success of the Sands has made casino developers and other designers sit up and take notice.

"…The design of the Sands has undergone substantial changes since its first presentation, but fundamentally, the design concept is the same, says Steelman.

"…One of the fundamental differences in the design of the Sands is the layout, Steelman says. While casinos are usually planned to spread out, with gaming facilities developed horizontally and any hotel towers placed above them, the Sands breaks this rule and layers multiple gaming and entertainment facilities above one another.

"…Curving the spaces also adds interest and complexity to the design as the perspective of the occupants and their experience of the space is always changing as they move through the building, he says, and 'this makes the gaming area always their focus'.

"…In another departure from convention, external lighting has been allowed into the building. While most casinos block out any references that remind gamblers of the time, Steelman lets light in and combines it with special effects lighting and other digital effects to create different moods at different times of the day.

"…As well as moving away from thematic designs towards more fundamental principles, buildings here will be more sympathetic and incorporate local design elements and features related to its history as a Portuguese colony and being part of China, he says…"

Even as the Singapore Turf Club is facing stiff competition from soccer betting, a new threat looms on the horizon with the possible introduction of a casino in the Republic. The New Paper finds out how the local turf club can take a leaf from the Macau Jockey Club's moves to ensure racing thrives in the face of such a daunting challenge

April 02, 2005

Danny Khoo
Reporting from Macau

THERE are already 16 casinos in Macau, with another five under construction in the former Portuguese enclave.

There are also more than a dozen sports betting outlets peppered across the boom city.

Despite the ever-increasing competition, betting on horses remains healthy and the privately-owned club controlled by Macau mogul Stanley Ho continues to enjoy its fair share of the gaming pie.

As Macau Jockey Club (MJC) director of racing Ian Paterson puts it succinctly in an exclusive interview with The New Paper at his Taipa office recently:

'There's a certain lure about horse-racing that will always attract the punting man or woman.

'Unlike casino games, where the player depends almost entirely on the roll of the dice, racing is not a game of pure chance.

'There's mystique and romance involved and there's always a test of a person's judgment when picking a horse to come out tops.

'There's also an element of skill involved and you can't leave it to pure chance. That's why racing will always survive.'

Despite a population of less than 500,000 to draw upon, turnover at the MJC has continued to enjoy steady growth.

Turnover, in the past few years, has jumped at least three-fold.

The MJC collects an average of HK$60 million ($12 million) per meeting or HK$5 million per race.

SECRET OF SUCCESS

So what is the secret behind the MJC's success?

'Racing in Macau has been able to co-exist with the burgeoning interest in casinos and soccer betting for quite a while because the MJC is constantly re-inventing itself.

'Better prizemoney is one move that goes down well with owners,' said Paterson.

'We have been increasing our prizemoney over the years and will continue to do so, especially for the higher classes.

'Of course, if the dividend payouts are healthy as well, punters will continue indulging in the sport.

'Our product must look favourable for the punters.'

HONG KONG TIE-UP

Its recent tie-up with the Hong Kong Jockey Club (HKJC) to televise the latter's races has raked in an additional HK$2 million ($420,000) a race.

The MJC has also benefited from the 'spillover' from the HKJC.

'Yes, we have many owners from Hong Kong who race with us because they want to be owners but are unable to do so because of the long queue at the Hong Kong Jockey Club,' said Paterson.

HONG KONG – As reported by the Dow Jones: "Macau fever and the ensuing mania for the enclave's plays may have cooled in recent months, but it's not too late to take a punt on Shun Tak Holdings Ltd.(0242.HK).

"Shun Tak has a pedigree of successful investments in Macau, say analysts - and shouldn't be lumped in with the many so-called Macau concept stocks that soared late last year even when their connection to the territory was, at best, tenuous.

"…Operating 15 of the city's 17 casinos, Shun Tak, owned by 83-year-old gaming kingpin Stanley Ho, is Macau. And Macau has come a long way since it was a sleepy Portuguese enclave more known as a weekend getaway for Hong Kong residents than as the gambling capital it's become.

"…Shun Tak shares, at their HK$7.35 close Thursday, have more than doubled from their HK$3.279 close on March 29 last year, though they're off their HK$9.15 peak on January 3. The shares, analysts say, are more than just a casino play.

"'We're bullish on Shun Tak because we're bullish on the Macau economy as a whole,' said CLSA analyst Keith Yeung. 'Along with its parent, Shun Tak is the biggest conglomerate in Macau.'…"

HONG KONG: Galaxy Waldo Casino and Hotel, which operates a gaming facility in booming Macau, plans to raise about US$200mil in a Hong Kong listing in June, sources close to the deal said.

The listing would be the first casino initial public offering (IPO) since the Hong Kong stock exchange allowed firms with gaming as their core business to float in 2003.

Galaxy Waldo, which opened last July, has 161 guest rooms and a casino with 63 gaming tables and 83 slot machines. The firm has reportedly appointed BNP Paribas and Deutsche Bank as the sponsors of the deal.

Investment in hotel and gaming projects in Macau is fast growing. The former Portuguese colony on the south China coast is the only place in the fast-developing country where casinos are legal. The 17 casinos there pay 35% of their gross receipts in direct tax to swell the public coffers. – Reuters

BALFOUR Beatty's £175m contract to build a Las Vegas-style hotel in China's hottest gaming enclave has raised hopes that other British businesses could profit from Asia's latest boom.

Macau, a tiny former Portuguese colony on the South China coast, is in the throes of an unprecedented wave of investment as global gaming giants position themselves for a slice of the action.

Analysts reckon Macau will surpass Las Vegas for gambling revenue soon, possibly this year, noting its avid Asian gamers spend twice as much per head as visitors to the US desert town.

Last year, Vegas pulled in $5.3bn (£2.8bn) while Macau's punters fished $5.1bn from their pockets. Deutsche Bank has estimated Macau's gaming revenue could grow 20% a year for the next half-decade.

Macau's economy grew by a quarter last year after expansion of almost 50% in the second quarter alone. Analysts estimate that, over the next five years, the equivalent of £10 billion could be invested in hotels, casinos, convention facilities and malls.

'It certainly is the global hotspot for gaming companies,' said an economist in Hong Kong - the former British colony sits a short ferry ride across the Pearl River Delta from Macau.

Balfour Beatty's win came through Gammon, a Hong Kongbased engineering and construction-company in which Balfour, led by chief executive Ian Tyler, picked up a 50% interest seven months ago for about £35m. The balance of the group is held by Jardine Matheson, one of Hong Kong's oldest trading groups.

Together with a Macau partner, Gammon is the lead contractor on the 3000-room, 32-storey Venetian Macau. The £1.1bn project will be the flagship property for US group Las Vegas Sands, one of the biggest Vegas players.

Britain's InterContinental Hotels is among seven hotel operators that have said they will back new properties along the fast-growing Macau strip, part of which was built on land reclaimed from the sea.

Macau's boom has been triggered by the local government's decision to liberalise gaming in the territory, inviting powerful Las Vegas players to compete head-to-head with a local casino operator.

At the same time, the central government has eased rules on mainland visitors, sparking a surge in arrivals from the rest of China, where casinos and gambling remain illegal.

Set to top Las Vegas in revenue this year

MACAU is poised to overtake Las Vegas as the gambling capital of the world before the end of the year.

The more than 16 million visitors who poured into the former Portuguese enclave last year pushed gambling revenues in the island's casinos to A$5.1 billion ($6.4b) for 2004, reported The Australiannewspaper.

That's just a whisper behind Las Vegas' A$5.3b.

Yet, Macau's received just half the number of visitors as the US gambling capital.

Moreover, its gambling jumped 40 per cent last year alone, and is set to grow at 18 per cent a year for the next three years, forecast Mr Marc Falcone, gaming analyst at Deutsche Bank.

The boom in demand is being matched by an explosion in facilities in the tiny enclave of 440,000 people.

The current 16 casinos with 894 gaming tables is set to balloon to more than 30 boasting 3,500 gaming tables in a building frenzy that also includes hotels, resorts and shopping malls.

The US$17 billion ($28b) is set to transform the territory from what The Australian described as 'a sleazy sinkhole of smoky gambling dens... into a conference centre and a family-friendly international tourist destination'.

In the first of two major investments that will change the face of Macau, Australia's richest man, Mr Kerry Packer, has teamed up with Mr Lawrence Ho, son of Macau gambling tycoon Stanley Ho, to build a $HK1.5 billion ($318b) six-star hotel and casino complex that is due to open next year.

In the second, Mr Sheldon Adelson, founder of the iconic Sands casino in Las Vegas, is planning a US$1.8 billion, 3,000 room hotel and tourist complex on an 4.7sq km area of reclaimed mudflat.

He believes the development on its own will be bigger, better and more profitable than any casino resort currently in operation in Las Vegas.

http://klas.static.worldnow.com/images/3146849_BG3.jpg

Las Vegas now has serious competition for the title of "Gaming Capital of the World." The latest gaming revenue shows casinos in Macau, China made about the same amount of money on gambling as Las Vegas.

The difference is that Macau matched Las Vegas gaming revenue with less than half the number of visitors. There were 16 million visitors to Macau in 2004. That same year, 37 million people came through Las Vegas.

Gaming experts say that Asian tourists visiting Macau gamble a lot more money than the average tourist coming to Las Vegas.

Casino operators in the valley realized that competition from around the world would take our gaming dollars. With the expansion Indian gaming in the U.S. and explosive growth in Macau,

UNLV gaming studies coordinator Dave Schwartz says Las Vegas changed. The Mirage was the first to add attractions to casinos like world-class shows and high-end shopping.

Schwartz says, "Las Vegas also expanded because they moved into non-gaming. That is a vindication of that decision."

That move away from gaming was embraced by the Las Vegas Convention and Visitors Authority. Senior Vice President of Marketing, Terry Jicinsky says Las Vegas is a destination that doesn't just rely on gambling to attract guests.

"People go there for short periods of time, whether it be four or five hours in the afternoon or an evening of gambling. People come to Las Vegas for the full resort vacation experience," Jicinsky said.

Las Vegas casino owners also realized the potential in Macau. Venetian owner Sheldon Adelson opened the Sands Macau. Wynn Las Vegas owner Steve Wynn is opening a casino there next year. MGM-Mirage started negotiations four years ago and announced a partnership for a new casino in Macau as well.

An MGM-Mirage spokesman says the Macau expansions will not be competition, but an opportunity for Las Vegas. As visitors in Macau grow, the companies here that own property there can a pitch for a trans-Pacific vacation.

But why does each gambler in Macau spend more than an average gambler in Las Vegas?

The tourists going to Macau take gambling more seriously than most visitors to Las Vegas according to UNLV's Dave Schwartz. He says a huge percentage of the gaming revenue in Macau comes from table games. He adds Asian gamblers are very picky about where they bet their money. Macau visitors play on baccarat, but you won't find a craps table.

Schwartz says, "Asian gamblers look at dice with distain."

An extremely small percentage of Macau tourists play slot machines.

Macau is located in a densely populated part of the world. There are millions of Asians targeted by the casinos there. "I think many of them are new to casino gaming and probably would not have the money to make the trip to come out to Las Vegas, but do have the money to go to Macau," Schwartz added.

In 2003, Eyewitness News went to Macau. In an interview there, Harald Bruning from the South China Morning Post said Macau gamblers bet larger amounts of money for a reason.

Bruning said, "They are convinced they are going to win. They believe in luck. Luck is what determines all of life, or lack of it."

At the moment life is good for the people who own casino properties in one of the world's fastest growing gaming meccas.

Gaming experts say Macau is one of those places in the world to try and get a foothold if you want to be a significant gaming company.

Macau is on its way to become the new gambling headquarters of the world, nabbing the title from current holder Las Vegas. Already this year, Macau is expected to exceed Vegas in gambling revenue, which has helped the Chinese-ruled nation boast an economic growth rate of 25 percent, with private investment shooting through the roof at 47 percent. With only half the visitors as Las Vegas, Macau managed to shoot up to $5.1 billion in gambling revenue last year. Compared to Las Vegas' $5.3 billion, this year's predicted performance is not such a long shot.

Macau's gambling boon is expected to grow for years to come. According to one estimation, within three years, Macau's 16 casinos and 894 gaming tables will grow to at least 30 casinos and 3500 tables. Additionally, the increased demand for property, resulting in part from the casino invasion, has helped raise property prices by 50 percent.

MACAU – As reported by the Australian: "Macau is poised to overtake Las Vegas as the gambling capital of the world before the end of the year.

"The more than 16 million visitors who poured into the former Portuguese enclave last year pushed gambling revenues in the island's casinos to A$5.1 billion (US$6.4 billion) for 2004.

"That's just a whisper behind Las Vegas' A$5.3b.

"Yet, Macau's received just half the number of visitors as the US gambling capital.

"Moreover, its gambling jumped 40 per cent last year alone, and is set to grow at 18 per cent a year for the next three years, forecast Mr Marc Falcone, gaming analyst at Deutsche Bank…"

By Catherine Armitage
March 28, 2005

IN the late 1940s, the mobster Bugsy Segal dreamed an improbable dream that a desert town could turn into one of the US's biggest resorts.
Years later, long after Segal's associates had silenced him, Las Vegas shook off the mob to become not only the world's gambling capital, but the fastest growing city in the US.

Now gambling moguls such as Kerry Packer and Steve Wynn are hoping to pull off, without the mob connections, a similar transformation in Macau – turning what has been a sleazy sinkhole of smoky gambling dens, recycling reputedly ill-gotten cash, into a conference centre and a family-friendly international tourist destination.

Over the next few years, more than $US17 billion ($22 billion) is poised to plunge into this tiny former Portuguese enclave, sparking a building frenzy of hotels, casinos, resorts and shopping malls that will transform the territory for its 440,000 people.

Already Macau ranks among the fastest growing places in greater China with economic growth of 25 per cent last year and 47 per cent growth in private investment. It is set to blitz Las Vegas in gambling revenues this year and Australian companies have a front seat at the tables.

Packer's Publishing & Broadcasting Ltd is teaming up with Lawrence Ho, son of Macau gambling mogul Stanley Ho, to build a $HK1.5 billion ($250 million), six-star hotel and casino complex due to open next year. Meanwhile, poker machine maker Aristocrat Leisure is setting up in Macau after soaring sales in the territory helped it become the best performing large stock on the Australian stock market last year.

Sands casino founder Sheldon Adelson last week unveiled his grand vision for a gambling and tourism strip which he expects to outclass and out-earn anything Las Vegas has to offer.

The anchor property on what is now 4.7sqkm of soggy mudflats – reclaimed from the ocean to make two islands into one – is the $US1.8 billion, 3000 room Venetian Hotel. There are plans for at least eight major hotels and a shopping citadel where cashed-up new-rich Chinese can pay homage to some of the world's best known (and hopefully genuine) luxury brands. Within seven to 10 years, there could be 60,000 hotel rooms, Adelson says, predicting the whole project will cost up to $US15 billion.

Frank McFadden, the Irishman running the new Sands, has billed it as perhaps the world's single biggest tourist investment ever.

Seemingly in response, Lawrence Ho was quoted in the Financial Times saying the partnership between his company Melco and PBL would build a $US1 billion "mass market" casino to take on the Sands properties. This will dwarf the $US192 million Park Hyatt already under way, which will cater primarily for high rollers, who account for an estimated 70-80 per cent of existing Ho revenues.

Aristocrat has snared 50 per cent of poker machine sales to the stunningly lucrative new Sands in Macau, which has earned back its $US250 million investment in less than a year.

Since the mainland regained control in 1999, visitor numbers have more than tripled from 6 million a year to 16.7 million last year thanks to China's progressive lifting of restrictions on individual travel for its citizens. Macau gambling revenues surged around 40 per cent to $5.1 billion last year. That's just a whisker behind Las Vegas's $5.3 billion, with half the visitor numbers. Macau revenues will grow 18 per cent a year through to 2008, forecasts Marc Falcone, gaming analyst at Deutsche Bank, by which time gambling opportunities are expected to balloon from the current 16 casinos and 894 gaming tables to at least 30 casinos and 3500 tables. Analysts say property prices are up 50 per cent in the past 12 months, while a frenzy for "Macau concept" stocks has fuelled warnings of a dotcom-style bubble in the making.

Melco has been a big beneficiary, its share price more than doubling from $HK7.15 to $HK19.15 since last October. Wynn Resorts doubled in price on the Nasdaq last year while Sands has added more than 60 per cent since listing last December.

Sands is one of three groups to secure gambling licences after Macau's chief executive Edmund Ho (no relation) ended Stanley Ho's 40-year monopoly on gambling in the territory in 2002. Stanley Ho's Sociedade de Jogos de Macau (SJM) also got a licence, as did Wynn Resorts, whose owner Steve Wynn created the famed Vegas casinos Mirage and Bellagio. Wynn Resorts has a $US700 million resort under construction.

"We designed (the casino) to be the antithesis of what was existing. Where there were low ceilings there is height. Where there was darkness, there is bright," says McFadden of the Sands Macau.

So far, the non-smoking gambling area and floor-to-roof windows on the upper level are working their magic. The casino is already earning more than the company flagship, the Venetian in Las Vegas.

On a recent Wednesday evening, about 4000 people crowded around the baccarat tables while dancers shimmied on an adjacent stage with the action beamed from a giant video screen overhead.

Stanley Ho, having lost 30 per cent of the Macau gambling take to the newcomers, is fighting back with four new casinos in the past two years and big plans for more. This includes a $US250 million Grand Lisboa hotel/casino taking shape across the road from his ageing landmark Casino Lisboa, and a $US110 million Fisherman's Wharf theme park. Due to open in September, it will feature a spewing volcano, a Mississippi steamboat hotel, a Chinese fort and a faux Colosseum.

"We are Chinese and we will not be disgraced. We will not lose to the intruders," Ho vowed at a company function in September, according to the South China Morning Post.

Excavation work has begun on the PBL-Melco Park Hyatt site where last week two men were laboriously shovelling dirt into plastic bags while five cranes worked overhead. Phase one, a six-storey casino of 200 tables and 1300 poker machines, is due to open mid-2006. The hotel of 240 deluxe VIP suites promises "spaciousness and unrivalled luxury decor" follows in 2007.

PBL-Melco are spearheading a pokie push into Macau. Among the assets of the joint venture are three "Mocha slot lounges", cafe-style machine parlours through which Melco-PBL are trying to persuade Chinese punters of the pleasures of pokies.

While machines are the "bread and butter" of casinos elsewhere in the world, including Australia and the US, they contribute less than 3 per cent of Macau gambling revenues, according to Michael Swing, Ho's nephew and regional operations manager of SJM.

"The Chinese don't play slot machines, only on their way from the baccarat tables to the toilet. Now we have to educate them," Swing says.

Lawrence Ho has charge of the task. It looks like an uphill battle. On a weekday afternoon when The Australian called in to the Mocha slot lounge at the Hotel Royale, on a winding hilly street well away from the big downtown gambling venues, all of about 30 places at the electronic roulette tables were taken. By contrast only six of 41 machines were occupied.

One older lady who declined to give her name was pressing the buttons of "Warrior Woman". She plays the pokies when she has some free time because she doesn't know how to play the table games, she says. It doesn't worry her that the machines are covered in English writing which she can't read. "The machine will tell you if you've won," she says.

According to Swing, Chinese punters prefer playing the tables because they have a greater sense of influence in the choice of "lucky" cards. The Sands has put in 1800 machines but there, too, few punters appear to be using them. "I don't think this will be a slot-based gambling industry in the foreseeable future," McFadden says.

Analysts estimate the eventual market at about 20,000 machines, compared with 680,000 in the US and more than 200,000 in Australia.

Foisting machines on an uninterested clientele isn't the only gamble for the PBL-Melco joint venture. There's also the matter of whether the Victorian and West Australian gaming authorities will deem Melco a fit and proper business partner for PBL, as is required by the terms of PBL's licences to operate the Crown casino in Melbourne and the Burswood casino in Perth.

In 1986, the NSW authorities deemed Stanley Ho, chairman of Melco, "unsuitable" to hold a NSW gaming licence during the tender for Sydney's Star City casino.

Melco-PBL, whose joint venture aims to cover casino developments throughout Asia including Vietnam, Japan and Thailand, are also among more than 12 groups who have tendered for the casino or casinos being considered by the Singapore Government.

Singapore is hesitant to tarnish its squeaky-clean image by introducing a passtime known to attract vice. A PBL-Melco proposal might be a long shot.

On the border with the mainland at Zhuhai, stall operators reportedly take cash deposits well beyond the legal cross-border limits in return for the promise of waiting chips at the casino counters in Macau.

Michael Swing admits with disarming candour that the Lisboa is happy to send winnings to Hong Kong for gamblers in false names, that it's not uncommon for people to leave the casino carrying bags full of cash; that the notorious jailed triad leader Broken Tooth was well known at the Lisboa where he was a "nice guy" who "behaved well".

But the bad old days just before the 1999 handover, when Macau citizens were cowed by casino bombings and street warfare between triads, are over, says Swing, thanks to a Chinese government crackdown.

"Macau is so small, you can't hide, they will find you. China knows exactly which are the good guys and which are the bad guys," says Swing.

Yet Macau hardly featured in a recent, well-publicised crackdown on the illegal outflow of mainland funds which has forced casino closures just across the borders in North Korea, Burma, Vietnam and Russia.

China may be content to turn a somewhat blind eye to shady dealings in Macau, which it holds up as a winning example of the "one country, two systems" model – an example it hopes to use to win over Taiwan.

"Macau's achievements since its return are a great source of joy to all of us," Chinese President Hu Jintao told Macau's chief executive Tung Chee Wa last December.

With China's average income adding 8 per cent a year for the past 20 years, more than a billion people living within a three-hour flight of the city, and the apparently enthusiastic support of Beijing, Macau may be a fair bet for a while yet.

Macau, China, Mar. 28 (UPI) -- Gambling moguls such as Australia's Kerry Packer and the Las Vegas' Steve Wynn are betting on Macau becoming the next the Las Vegas.

Some $22 billion is poised to be spent during the next few years on building hotels, casinos, resorts and malls in the former Portuguese enclave that now has a population of 440,000 and is considered a special administrative region of China.

Packer's Publishing & Broadcasting Ltd. has partnered with Lawrence Ho, son of Macau gambling mogul Stanley Ho, to build a $250 million, six-star hotel and casino complex scheduled to open next year, The Australian reported Monday.

Wynn Resorts, which created the famed Las Vegas casinos Mirage and Bellagio, has a $700 million resort under construction.

Some 16 million visitors to Macau helped its gambling revenues grow 40 percent to $5.1 billion last year, just behind Las Vegas's $5.3 billion, The Australian said.

8 April 2005

MACAU – As reported by the Agence France Presse: "…The rise of the casinos in the southern Chinese territory has been dubbed a miracle: GDP growth for 2004 is expected to pan out at a massive 26.5 percent and for 2005, between 15 and 20 percent.

"But with every silver lining comes a cloud, and the crushing of the gardens -- and many other beauty spots around the ancient city -- under the wheels of rampant economic development has become the focus of a growing discontent among many locals with the mushrooming gaming industry.

"While roulette and card tables are providing public finances and jobs for a tiny city of 450,000 people that 40 years ago relied on textiles and fishing, they are also bringing a host of undesirable social costs that have lowered the quality of life in this once sleepy enclave.

"…The race is on to provide not only homes for the growing workforce that is being drafted in from China, the Philippines and Hong Kong to staff the casinos but also to construct hotels, holiday homes and second homes for the increasingly affluent Chinese tourists who have swollen attendances in the century-old casino industry…"

Casino operators are placing big bets on Macao with good reason. The former Portuguese enclave, which tore up its gambling monopoly in 2002, is set to overtake Las Vegas as the world's biggest gaming market this year. International operators are stacking the chips high.

Last month, Las Vegas Sands outlined plans for a $12bn-$15bn casino-and-hotel project. Melco International Development, the incumbent operator, and Australian tycoon Kerry Packer pledged more than $1bn for a new mass-market casino.

The Las Vegas Sands Corp., together with world-renowned hotel brands and leading investment companies is currently developing a Las Vegas-style entertainment strip in Macau. The strip is a master planned development of resort casino properties on Cotai, an area of reclaimed land between the islands of Taipa and Coloane in Macau.

"By assembling an attractive group of world-class hotel brands, with the support of the Macau SAR government, this development will reposition the city as an international tourist and convention and exhibition destination," said Sheldon G. Adelson, chairman and CEO of Las Vegas Sands Corp., as he unveiled a massive model of the proposed COTAI strip.

The first phase is scheduled to open in 2007, which will feature seven resort hotels offering more than 10,000 guestrooms set amidst lush tropical landscapes. In addition, there will be world-class meetings and convention facilities, over 20,000 seats of live entertainment in 8 separate theater venues and the most modern and exciting casinos in Asia.

Las Vegas Sands Corp. president William P. Weidner confided that the Dorset Hotel Group, Four Seasons, Hilton Hotels, InterContinental Hotels Group, Marriott International, Regal Hotels, and Starwood Hotel and Resorts Worldwide are involved with the project. "It took 75 years for Las Vegas to emerge as an entertainment destination. Our intention is to replicate that feat, for Macau, in less than 3 years.

April 19 (Bloomberg) -- K. Wah Construction Materials Ltd., a Hong Kong-listed builder, said it plans to acquire 97.9 percent of a Macau casino operator for HK$18.4 billion ($2.4 billion) in new shares and other securities.

K. Wah Construction will buy Galaxy Casino SA from the Lui family, which controls the builder through K. Wah International Holdings Ltd., a unit of Guoco Group Ltd. and other shareholders of Galaxy, according to a joint statement today. Galaxy Casino, backed by K. Wah Chairman Lui Che-woo and Sheldon Adelson's Las Vegas Sands Corp., operates a casino at the Waldo Hotel in Macau, the only place in China that allows casino gambling.

Galaxy, backed by K. Wah Chairman Lui Che-woo and Las Vegas Sands, won one of three gaming licenses in 2002 when Macau ended tycoon Stanley Ho's 40-year monopoly. Macau, the world's biggest gaming market after the Las Vegas Strip in 2004, has forecast gambling will contribute a bigger share of the economy in two years as casino operators such as Adelson add blackjack and roulette tables in their quest to replicate the Las Vegas Strip.

Macau last year had $5 billion in gambling revenue, up 44 percent from 2003. During the first two months of this year, Macau's gaming revenue was $831 million, compared with $947 million in the Las Vegas Strip, K. Wah said in the statement.

K. Wah plans to issue 1.84 billion new shares for HK$8 each to finance 80 percent of the purchase. The remainder would be financed through the sale of unsecured fixed-rate notes and possibly some cash, the statement said.

Gaming receipts by 2007 will account for 60 percent of gross domestic product, Manuel Joaquim das Neves, director of Macau's Gaming Control Board, said earlier this month. Macau's economy last year expanded a record 28 percent to 82.7 billion patacas ($10.3 billion), with gambling accounting for half the total. Galaxy Casino has posted profit of HK$72.7 million since the company began operating last July.

K. Wah Construction Material said it plans to change its name to Galaxy Entertainment Group Ltd. The builder forecasts Galaxy will need HK$5.74 billion in the next four years to 2009 to build a casino and hotel resort.

Adelson aims to fill Macau's Cotai, a stretch of reclaimed land in about the size of two football stadiums, in seven to 10 years with casino resorts providing 60,000 rooms. Galaxy's capital expenditure would be financed through debt and stock sales and internal cash, K. Wah said.

Now that Singapore has just approved the building of two casinos....how is the Macau media reacting to it?

In general, the media does not see Singapore openning casino as a threat. By the time that Singapore gets their first 2 casinos, Cotai Strip, Macau's MGM, Wynn, and Venetian would be completed already. Moreover, Macau is closer to China compared to Singapore and people will not travel that far to gamble when they can do it closer with better selections as well.

I don't think there's much effect for Macau if singapore opens casinos because majority of the people gambling in Macau are those from Hong Kong, China and Taiwan.

MGM Mirage Inc., the world's second-largest gaming company, said Tuesday that its joint venture partnership with Pansy Ho Chiu-king has been granted a subconcession, allowing the partnership to develop and operate hotel and casino resorts in Macau.

The subconcession was approved by the government of Macau SAR.

The initial project, to be called MGM Grand Macau, will be located on a waterfront site next to the planned Wynn Resorts facility and near the Lisboa hotel-casino. The MGM Grand Macau project will include the development of a resort featuring about 600 rooms, suites and villas, a casino including 300 table games and 1,000 slot machines, several restaurants and entertainment facilities.

The MGM Grand Macau will also have about 50,000 square feet available for future expansion. The project cost, including land and license rights, preopening and capitalized interest, is about $975 million.

Construction of the resort will begin in the second quarter of 2005 and is expected to open in 2007. MGM Grand Macau will be 50/50 owned and jointly operated by the two partners.

Pansy Ho is managing director of Shun Tak Holdings Ltd., a Hong Kong-based conglomerate operating shipping, property, hospitality and investment businesses. Shun Tak will not participate in MGM Grand Paradise. In addition to her position with Shun Tak Holdings, Pansy Ho is chairman of the Macau Tower Convention and Entertainment Centre.

MGM Mirage shares rose $1.27 to $71 in morning trading on the New York Stock Exchange.

MACAU, The Macau government collected a record 3.82 billion patacas (US$478 million) in gaming taxes in the first quarter, up 24.1 percent from the same period last year, the Finance Services Bureau said..

Gross-revenue casino taxes made up 77.29 percent of total government revenue of 4.94 billion patacas between January and March.

Macau is the only place in gambling-mad China where casinos are legal. Its 17 casinos, which are run by three rival operators, pay 35 percent of their gross revenue as direct tax to the public coffers.

In the first quarter, the government's total expenditure amounted to 2.73 billion patacas, an increase of 18.7 percent on the same period last year.

The government's overall surplus reached 2.19 billion patacas between January and March.

Macau's economy grew by 28 percent in real terms last year, the government announced earlier this month. Tourism, gambling and textile and garment exports are the mainstay's of the tiny territory's economy.

Hong Kong property tycoon Lui Che-woo has agreed to sell his casino in Macao to a construction firm controlled by his family for HK$18.4bn which will give the gaming business a listing in the territory.

K Wah Construction materials, which has proposed to change its name to Galaxy Entertainment Group, will become the first Hong Kong-listed casino operator amid a growing frenzy for gambling businesses in the region. Singapore said this week it would build two casino resorts by 2009.

Singapore’s plan to open two casinos has given rise to concern from two of China’s Special Administrative Regions (SAR), but Chinese tourism officials believe that the new casinos shouldn’t affect Chinese tourism to Hong Kong or Macau.

Since Singapore is not as close to Mainland China as the two SARs, many believe that it doesn’t pose a significant threat to their economies. In addition, both Hong Kong and Macau have special tourist attractions that set it apart from other tourist destinations. Hong Kong is known as the “Gateway to China” and has many festivals, including the Flower Festival, the Buddha Festival, and the Dragon Boat Festival. Macau, on the other hand, has landmarks of Chinese heritage and history.

In addition, Macau is fast becoming the most popular casino destination. Revenues have grown 30% in the past three years, while there has only been a 4% revenue growth in Las Vegas, currently considered the number one gaming city in the world. Las Vegas made US$5.3 billion last year, but Macau wasn’t far behind with US 5 billion in revenues. With the Macau gambling industry fast rivaling that of Las Vegas, Chinese tourism officials are convinced that Singapore’s two casinos pose virtually no threat to its SARs, particularly Macau.

MACAU - On Tuesday, one day after Singapore Prime Minister Lee Hsien Loong sanctioned the development of two casinos in the state-city, both of Macau's two leading gaming operators, despite claiming to be fearless to the challenge, unveiled their moves to further enlarge Macau's gaming development.

Casino mogul Stanley Ho and Hong Kong's wealthy Lui family coincidentally chose the same day to unveil, respectively, the leasing of a gaming sub-concession to the Las Vegas-based MGM Mirage and a billion-dollar deal paving the way for the Macau-based Galaxy Casino's Hong Kong listing.

"There is no such need to worry that Singapore would draw away Macau's Southeast Asian customers," said Stanley Ho, managing director of the Macau Gaming Co Ltd (SJM). Ho had virtually dominated Macau's gaming industry for 43 years, until May 2004, when the first American casino, Sands Macau, invested in by the Sands in Las Vegas, was erected in Macau.

Soon after the inking on Tuesday of his first gaming sub-concession contract, allowing MGM Mirage to invest in casino projects in Macau, Ho said SJM is very sure of its competitiveness.

Ho mentioned that Macau's gaming business has co-existed with Malaysia's Genting Casino for dozens of years without battling for customer sources.

Meanwhile, K Wah Construction Materials Ltd, a family business belonging to Hong Kong tycoon Lui Che Woo, announced on Tuesday it would purchase a 97.9% stake in Galaxy Casino, which is run by Lui's son Francis Lui, becoming the first Hong Kong-listed casino operator and capitalizing on investor interest in Macau's gaming market boom.

Lui said that after Macau's gaming market liberalization, which took effect in 2004, investors have been rushing to pour money into building high-quality gaming facilities. Macau is undergoing a transformation from a pure gambling city toward a recreational resort destination attractive to conference organizers, vacation goers and business travelers.

Galaxy Resort and Casino obtained a license for casino operation through government-run public bidding in 2002, with Wynn Resorts and SJM as its major rivals. After launching business last July, the casino has taken up 14% of Macau's gaming market.

Galaxy earned HK$72.7 million (US$9 million) on gaming revenues of HK$123.7 million (US$16 million) in the second half of 2004. Lui announced on Tuesday that the company would invest another HK$5.7 billion (US$730 million) on four new casino projects aimed at high rollers in Macau in the next few years.

There are now 17 casinos operating round-the-clock in Macau, which yielded US$5 billion in revenues last year, challenging the profitability of its American rival Las Vegas. The number of gaming tables and slot machines here has reached some 1,400 and 1,000, respectively.

It seems that Macau's role as the No 1 gaming city in Asia will remain unchallenged for the near future, say gaming tycoons. With a history in the gaming business dating back over 150 years, the industry has withstood good and bad years, has remained the backbone of the economy and is getting more prosperous than ever with this newest tourist boom. As the two casinos in Singapore are not scheduled to be operational until 2009, it will still be some time before the city-state will be able to nurture a sustainable gaming business.

[Asia News] HONG KONG, The family that controls Malaysia's Genting Group has bought a stake in the first casino in booming Macau to be listed on a stock exchange, sources said on Friday, in a bid to spread its gaming interests across Asia.

Lim Goh Tong and his family, whose firm runs Asia's biggest casino and is a top contender to operate a casino in Singapore, paid $102.6 million for 6.9 percent of Hong Kong's K. Wah Construction <0027.HK>, which is buying the Galaxy Casino in Macau.

Shares in Genting Group, 41.4 percent owned by Lim Goh Tong and his family, jumped 3.85 percent to 18.9 ringgit by 0400 GMT.

The deal by the Lim family, which made its fortune in construction before the Malaysian government granted it its only casino license in 1969, was part of a $150 million share placement by K. Wah, to fund the $2.36 billion Galaxy purchase.

K Wah had planned to raise much more money but the placement had to be reduced by 40 percent to comply with stock exchange rules, according to sources. The company's shares had fallen 13.45 percent to HK$7.40 by 0400 GMT.

The Hong Kong firm, which started as a quarry operation in 1964, will rename itself Galaxy Entertainment Group and is touting its shares as the "only Macau pure play" stock.

Macau, the only place in gambling-mad China where casinos are legal, has seen an investment and tourism boom since tycoon Stanley Ho's 40-year gaming monopoly lapsed in 2002. China's relaxing of travel restrictions for residents helped as well.

Macau related stocks are hot, with recent investor favourites including A-Max Holdings <0959.HK>, which owns a stake in the new Greek Mythology Casino, Macau ferry operator Shun Tak Holdings <0242.HK>, and slot machine firm Melco International <0200.HK>.

K. Wah Construction's acquisition of 97.9 percent of Galaxy represents a reshuffling of assets by Hong Kong's Lui family. The family controls the casino, K. Wah Construction and its parent K. Wah International, and will have a 76 percent stake in Galaxy Entertainment.

But K. Wah Construction's failure to raise what it wanted in its share placement is a hitch for the deal -- it was supposed to help fund a HK$3.68 billion payment in unsecured fixed rate notes or cash that supplemented a HK$14.72 billion issue of new K. Wah shares.

The sources said the placement of 146 million new shares was at HK$8 each and twice covered by demand.

By Joe Leahy

When tycoon Lui Che-woo announced the HK$18.4bn backdoor listing of his Macao Galaxy Casino this week, there was palpable excitement in Hong Kong.

Hong Kong’s punters would finally be getting their first pure casino play – a chance to bet directly on the high-rolling habits of their gambling brethren across the Pearl River, rather than through the market’s usual motley collection of Macao proxies, mostly hotel, travel and property companies.

Pansy Ho buys 50 percent of casino.

Casino heiress Pansy Ho has invested US$80 million (HK$624 million) for a half-stake in MGM Grand Paradise, slated to become the city's fifth casino operator.

Ho shares ownership of the MGM Grand Paradise with American casino giant MGM Mirage, which published its agreement with Ho in a filing this week with United States securities regulators.

MGM Grand Paradise is investing about US$775 million to build the MGM Grand Macau casino resort behind the Wynn Macau resort.

The joint venture is paying about US$200 million to Sociedade de Jogos de Macau, the casino company run by Ho's father, Stanley, for the right to operate in Macau. It hopes to open its first project in late 2007.

MGM Mirage's filing revealed that Pansy Ho paid US$12.5 million for her shares in MGM Grand Paradise and extended an interest-free shareholder loan of US$67.5 million to the venture.

MGM Mirage paid US$112.5 million, or nine times more than Ho, for its half of the venture's shares. It also extended an interest-free loan of US$67.5 million and committed to lend an additional US$100 million with interest.

Ho gets to appoint four of the venture's seven directors, who will initially include herself and sister Daisy.

MGM Mirage's appointees, including its chairman and chief executive Terry Lanni, executive vice president Gary Jacobs and MGM Mirage Development president Kenneth Rosevear, get equal voting power on the board, despite being outnumbered. Lanni will serve as chairman and Pansy Ho as managing director. The filing said the venture will pay MGM Mirage a consulting fee equal to 1.75 percent of the cost of the MGM Grand Macau, excluding land cost, for providing development assistance.

A company designated by Ho will receive a development consulting fee of 0.875 percent of costs. MGM Grand Macau will include 2 million square feet of gross floor area, according to the shareholders' agreement.

MGM Grand Paradise is to repay US$30 million of the interest-free shareholder loans each year after the MGM Grand Macau opens, then US$50 million a year once it has paid off the interest-bearing loan from MGM Mirage.

Once the interest-free loans are repaid, MGM Grand Paradise will pay its owners US$30 million in advance dividends each year, or US$50 million if the interest-bearing loan has been paid off.

The agreement addresses a range of contingencies by potentially requiring any partner whose circumstances might change to withdraw from the venture. These include Ho succeeding her father, 83, as managing director of SJM, MGM Mirage's investing in other companies operating casinos in Macau, or MGM Mirage's gross gaming revenue dropping below US$1 billion a year.

MGM Mirage generated US$2.2 billion in casino revenue last year.

Despite the venture's momentum, Nevada regulators have said they are continuing to investigate Pansy Ho, and have yet to give their consent to MGM Mirage forming a partnership with her.

Wynn Las Vegas is positioned as the pre-eminent luxury resort in a town where high-end properties such as the Bellagio, Venetian and Mandalay Bay have proved to be the most profitable in recent years.

Steve Wynn's $2.7 billion gamble on the luxury market couldn't have come at a better time, analysts say. Room rates reached historic levels last year, driven in part by conventioneers wielding corporate charge cards and willing to pay more for rooms during slower periods in the middle of the week.

So far this year, some companies already are reporting record rates.

But Wynn isn't just banking on the occasional high-end tourist or conventioneer willing to shell out $300 or more for a room.

His resort aims to attract the world's wealthiest travelers -- people who avoid big Las Vegas casinos for the likes of a Four Seasons or a Ritz Carlton. Another key customer segment will be Asian high rollers who prefer the comfort of private gambling halls.

The opening of resorts has historically helped boost tourism across the board by creating more attractions, operators say.

Case in point: The opening of the Bellagio, Venetian, Paris and Mandalay Bay resorts in 1998 and 1999 flooded the market with thousands of rooms, yet visitors to Las Vegas grew 10 percent in 1999 and 6 percent in 2000. Visitation grew less than 1 percent from 1997 to 1998. The Las Vegas Convention and Visitors Authority expects 38.2 million visitors this year, a 2 percent increase from 2004.

But some believe Wynn Las Vegas will do more than attract returning visitors.

"Steve's going to bring new people" to Las Vegas, MGM Mirage Chief Executive Terry Lanni said. "That benefits all of us. On average, people visit two to three other casinos when they're here."

"When people just add new capacity without adding excitement that becomes a problem," Lanni said. "That's not his (Wynn's) style and that's not his history."

With 2,700 rooms, the resort is the 15th largest Strip resort and smaller than high-end competitors such as Bellagio, Mandalay Bay and the Venetian. Customers will be paying in the high $200s and up for a standard room that is about 620 square feet.

A key resort feature will be at least three private gaming salons that allow high rollers who otherwise wouldn't play in public to gamble behind closed doors.

To lure big-money international players, Wynn has opened marketing offices in Vancouver, British Columbia; Tokyo; Taipei, Taiwan; Singapore and Hong Kong and expects to open others in mainland China -- a huge and untapped tourism market.

Wynn has a history of raising the bar and drawing high rollers from other properties, Goldman Sachs analyst Steven Kent said in a research note to investors.

When the Mirage opened in 1989 it assumed the high-end market leader position from Caesars Palace. The same was true for Bellagio, which stole market share from the MGM Grand, Kent said.

In a separate research report, Legg Mason stock analyst Rod Petrik said Wynn Las Vegas could capture up to 30 percent of the Strip's high-end gambling market. On the downside, high-roller perks can get expensive and gamblers on a lucky streak can take a casino for millions, he said.

"With a large portion of gaming revenues coming from Macau, Wynn Resorts will need to attract certain players by offering casino credit and markers," which can be more difficult to collect outside of the United States, he said.

Las Vegas Sands President William Weidner said Wynn Las Vegas will help business at the Venetian and vice versa.

"We will both benefit" from partnerships with Macau resorts, Weidner said.

Helping Wynn draw Asian gamblers will be a team of executives including Linda Chen, who served as executive vice president of international marketing for MGM Mirage from 1997 to 2002. Wynn has boasted that Chen, head of international marketing and chief operating officer for Wynn's Macau subsidiary, knows just about every high roller in Asia.

Wall Street has been salivating over prospects in Macau, which is 40 miles from Hong Kong and within a few hours of 100 million citizens in mainland China. Many of them are experiencing improving standards of living and a desire to travel.

While its political and regulatory climate is far less certain than Nevada's, Macau is projected to handily eclipse Las Vegas Strip revenue in the future. Last year Macau's gambling revenue was $5 billion, up from $3.5 billion in 2003. By comparison, Strip casinos generated $4.9 billion last year.

With only 15 casinos in operation and about 700 table games combined, that amounts to a staggering per-table revenue of about $19,000 a day -- nine times the Strip's average win-per-table of about $2,100, according to Petrik. He said he projects Macau's gaming market could grow from $9 billion to $12 billion in the next five years as more Chinese visit the region and more resorts are built.

The door opened for Wynn and Las Vegas Sands in 2002 when Macau granted the companies concessions to run casinos, breaking billionaire Stanley Ho's decades-old monopoly on that lucrative gaming market.

Executives at MGM Mirage, which already controlled the majority of the high-end market in Las Vegas before its purchase of Mandalay Resort Group, say they are prepared for new competition.

At Bellagio, Wynn's crowning achievement in luxury taste, MGM Mirage invested $325 million in a new tower that opened in December and remodeled existing guest rooms. The company also has revamped many of its restaurants and other amenities at the Bellagio, MGM Grand and Mirage -- a trinity that now competes in the high end, Lanni said.

"We're going to be extremely competitive and at the top of our game," Lanni said. Having multiple upscale properties to Wynn's single resort will give the company a competitive advantage, he said.

MGM Grand President Gamal Aziz said "it's hard to be at all concerned" that Wynn will siphon business from his company.

"They add a very small percentage of rooms to the huge market we already have," Aziz said. "I think that a property of this magnitude can only grow and extend the market for all."

MGM Grand's high-roller villas, known as the Mansion, would be "nearly impossible to duplicate" and remains a "preferred destination for high-end customers," he said.

"This doesn't mean that we will just sit by the phone and wait for the customers," Aziz said. "We'll continue to market to those customers, continue to surround them with great service and a great product -- we love competition."

Wynn has another ace in the hole for high rollers, analysts say. The resort features the Strip's only golf course -- an attraction that can't easily be built elsewhere and can help lure international gamblers, they say.

"The popularity of golf has risen worldwide and scheduling tee times in some foreign countries can be extremely difficult," Petrik said in a research note.

The resort's largest suites, some with private massage rooms, face the golf course with a waterfall over the 18th hole.

MACAU - On Tuesday, one day after Singapore Prime Minister Lee Hsien Loong sanctioned the development of two casinos in the state-city, both of Macau's two leading gaming operators, despite claiming to be fearless to the challenge, unveiled their moves to further enlarge Macau's gaming development.

Casino mogul Stanley Ho and Hong Kong's wealthy Lui family coincidentally chose the same day to unveil, respectively, the leasing of a gaming sub-concession to the Las Vegas-based MGM Mirage and a billion-dollar deal paving the way for the Macau-based Galaxy Casino's Hong Kong listing.

"There is no such need to worry that Singapore would draw away Macau's Southeast Asian customers," said Stanley Ho, managing director of the Macau Gaming Co Ltd (SJM). Ho had virtually dominated Macau's gaming industry for 43 years, until May 2004, when the first American casino, Sands Macau, invested in by the Sands in Las Vegas, was erected in Macau.

Soon after the inking on Tuesday of his first gaming sub-concession contract, allowing MGM Mirage to invest in casino projects in Macau, Ho said SJM is very sure of its competitiveness.

Ho mentioned that Macau's gaming business has co-existed with Malaysia's Genting Casino for dozens of years without battling for customer sources.

Meanwhile, K Wah Construction Materials Ltd, a family business belonging to Hong Kong tycoon Lui Che Woo, announced on Tuesday it would purchase a 97.9% stake in Galaxy Casino, which is run by Lui's son Francis Lui, becoming the first Hong Kong-listed casino operator and capitalizing on investor interest in Macau's gaming market boom.

Lui said that after Macau's gaming market liberalization, which took effect in 2004, investors have been rushing to pour money into building high-quality gaming facilities. Macau is undergoing a transformation from a pure gambling city toward a recreational resort destination attractive to conference organizers, vacation goers and business travelers.

Galaxy Resort and Casino obtained a license for casino operation through government-run public bidding in 2002, with Wynn Resorts and SJM as its major rivals. After launching business last July, the casino has taken up 14% of Macau's gaming market.

Galaxy earned HK$72.7 million (US$9 million) on gaming revenues of HK$123.7 million (US$16 million) in the second half of 2004. Lui announced on Tuesday that the company would invest another HK$5.7 billion (US$730 million) on four new casino projects aimed at high rollers in Macau in the next few years.

There are now 17 casinos operating round-the-clock in Macau, which yielded US$5 billion in revenues last year, challenging the profitability of its American rival Las Vegas. The number of gaming tables and slot machines here has reached some 1,400 and 1,000, respectively.

It seems that Macau's role as the No 1 gaming city in Asia will remain unchallenged for the near future, say gaming tycoons. With a history in the gaming business dating back over 150 years, the industry has withstood good and bad years, has remained the backbone of the economy and is getting more prosperous than ever with this newest tourist boom. As the two casinos in Singapore are not scheduled to be operational until 2009, it will still be some time before the city-state will be able to nurture a sustainable gaming business.
I personally find the comparisons made between Singapore and Macau a tad over-blown. When Genting opened a casino in Malaysia, its not like Las Vegas was shaken. It has 3 casinos now the last I heard, compared to just two in Singapore, so whats the freakin deal?? :D

http://mishappa.image.pbase.com/u17/firelink/large/39234292.GreekMythologyTheCasino.jpg

CHICAGO (MarketWatch) -- Strong demand in its home market and the opening of a casino in Macau drove Las Vegas Sands Corp.'s revenue sharply higher but charges dragged the gambling company's first-quarter bottom line down to a fraction of year-ago levels.

Las Vegas Sands Corp. (LVS: news, chart, profile) on Tuesday said it earned $7.1 million, or 2 cents a share, down from $49.9 million, or 15 cents a share, in the year-ago period.

Excluding exceptional items, which include losses on asset disposal and an "unusually large charitable contribution," the company would have earned 29 cents a share in the quarter, up from 12 cents and ahead of the 25-cent average estimate of analysts polled by Thomson First Call.

The company credited the boost in adjusted profit to revenue from Sands Macao, strong gambling volumes in Las Vegas and lower interest costs.

Total revenue climbed to $403.8 million from $239.2 million, largely on the opening of the Sands Macao. Gambling volume at the Venetian in Las Vegas was up but the players were luckier as the company's table-games win percentage fell to 23.8% from 28%.

On the hotel side, average daily room rates and revenue per available room were both up but occupancy levels were down a bit, keeping overall revenue flat.

Analyst concerns that the Macau property was underperforming -- and that it will soon face tougher competition in that market from MGM Mirage (MGM: news, chart, profile) and other gambling operators -- helped drive down shares of Las Vegas Sands, which ended the regular New York Stock Exchange session Tuesday with a loss of 5.7% at $36.10.

By William Spain, MarketWatch
Last Update: 4:28 PM ET May 3, 2005

MACAU – As reported by Reuters: "Gross casino revenue in the gaming-friendly Chinese enclave of Macau is seen rising more than 40% in April from the same month last year, a Macau government source said on Thursday.

"The gross revenues of Macau's 17 casinos were estimated at 3.7 billion Macau patacas (US$462mil) for the month, said the source, who declined to be named.

"…In the first four months, the casino sector's gross receipts rose more than 20% to 13.9 billion patacas from 11.5 billion patacas in the same period last year, the source said…"

MACAU: Gross casino revenue in the gaming-friendly Chinese enclave of Macau is seen rising more than 40% in April from the same month last year, a Macau government source said on Thursday.

The gross revenues of Macau's 17 casinos were estimated at 3.7 billion Macau patacas (US$462mil) for the month, said the source, who declined to be named.

Macau, a former Portuguese territory which returned to Chinese rule in 1999, is the only place in China where casinos are legal.

In the first four months, the casino sector's gross receipts rose more than 20% to 13.9 billion patacas from 11.5 billion patacas in the same period last year, the source said.

The casino industry generated a record gross revenue of 40 billion patacas last year, more than doubling over the previous three years, according to official figures.

Macau casino mogul Stanley Ho Hung Sun's Sociedade de Jogos de Macau (SJM) accounts for about 70% of the territory's gaming market, with the balance shared equally by Hong Kong-owned Galaxy Casino and the local unit of Las Vegas Sands Corp, which runs Macau's first American-type casino, the Sands.

Australia's most famous gambler, Kerry Packer, is doubling up in the gaming haven of Macau, building a second casino that is twice the size of his first.

The nation's richest man also appears to be going for extra wow-factor - building it underwater, to showcase tropical marine life, and tacking on a huge resort.

Mr Packer's Publishing & Broadcasting Ltd (PBL) said it would build the resort and casino with Melco International Development Ltd, which is controlled by Lawrence Ho, the son of Macau casino mogul Stanley Ho.

"Construction is expected to commence in the latter part of 2005 and the complex is expected to commence operations in mid-2008," PBL said in a brief statement.

The news pumped its share price up 48 cents, or 3.3 per cent, to $14.88.

PBL teamed up with Melco last year to expand their gaming interests in Asia, Australia and New Zealand, a move that has positioned it to capture a slice of one of the fastest growing gaming regions.

Their first project was the Park Hyatt Hotel and Casino on the island of Taipa, about 10 minutes drive from Macau via a bridge.

They did not say how much this latest project will cost.

But they will pay about $US214 million ($A276.9 million) to buy the rights to a 25 year continuously renewable lease from the Macau government for 113,325 square metres of land on the Cotai Strip.

And they will build an underwater casino hall capable of housing 450 gaming tables and 3,000 slot machines - making it twice the size of the casino being built as part of the partner's first Macau project.

PBL said the Cotai strip resort and casino would have two blocks of deluxe service apartments, two 4-star hotels, one 5-star hotel, an upmarket shopping mall plus an "iconic performance hall/theatre".

CommSec analyst Olivia Cartwright said the Cotai project was a much bigger deal than the first.

"It is pretty large, eventually it will be significant but there won't be any earnings impact until 2008," Ms Cartwright said.

PBL said discussions are underway for the casino to be operated by Stanley Ho's company, Sociedade de Jogos de Macau S.A., which holds one of the three gaming licences in Macau.

The partners are also bidding for a licence to build and operate a casino in Singapore.

Daniel Schultz places a call through to his account manager in Costa Rica and clears a huge bet that he then puts on red in one of the glitzy new casinos in the southern Chinese territory of Macau.

No money changes hands, neither do any chips. There isn't even a roulette table nearby.

In fact, the whole transaction is conducted over a mobile phone - in the cafe.

This is the future of gambling Macau-style, a far cry from the smoky, seedy dens that used to rule the roost in this former Portuguese enclave that has been Asia's gambling haven for more than a century.

Schultz is demonstrating the latest innovation from Realtime Gaming, an American company that claims to be able to put the thrill of the punt into a computer, a phone, even into a console.

It plans to put computer-linked flat-screens in the unused corners of the city's casinos, allowing operators of the fast-proliferating gaming rooms to "monetize" every spare bit of space with online gambling consoles.

Realtime Gaming is just one of hundreds of overseas companies looking to cash in on the mushrooming casino business here. Dozens of them gathered for the city's first ever casino-supply expo two weeks ago and a similar event to be held in June is expected to attract 300 firms.

Security equipment suppliers, LED screen builders, caterers and construction contractors are among the latest wave of businesses to join the clamor for Macau gold after the initial rush of casino operators, including MGM Mirage and Wynn Resorts, and hotel management firms, such as Starwoods.

When the city reverted to Chinese rule five years ago, such foreign interest in the tiny southern territory would have been unthinkable.

But Macau has changed, especially since May 18 last year when the first American casino opened in what had until then been a Chinese-only gambling sector.

Sands Macau, owned by the Las Vegas casino giant that owns the hugely popular Venetian, brought glitz and glamour to a casino industry that had been dominated for 40 years by the down-at-heel gaming halls of tycoon Stanley Ho.

Among the new proposals is a score of casino-hotel complexes on a huge reclamation, which, when complete, is expected to pull in more money than all the resorts on the Las Vegas strip.

With a sudden surge in mainland Chinese tourists fuelling this growth, Macau is now big business and everybody is trying to get a piece of the pie.

"I predict that within a few short years about 25 percent of all our casino business will be in Macau - that's from very little now," said Scott Madding, international casino sales manager for the United States Card Company.

With each casino in the city consuming some 20,000 cards each night, his company sees huge gains in the new Macau.

This is the kind of talk the city's financial bosses love. When they decided to reinvigorate the ailing sector by relaxing foreign ownership rules for casinos three years ago, vested interests that opposed the move were placated with promises that the entire city would benefit in the long-run.

Financially, it has gained in a very short space of time. Last year, increased gambling receipts earned the city's Beijing-backed administration 15.2 billion patacas (US$1.94 billion).

The industry is proving such a money-spinner that by the middle of last year, revenue from gambling taxes had already paid off the city's 13-billion pataca public-spending budget for last year.

Residents were rewarded with tax cuts and the colossal civil service with pay rises.

Foreign companies are being lured by the huge earning potential of Macau's handful of casinos. Last year they pulled in some 42 billion patacas, the equivalent of the earnings made in all the casinos on the Las Vegas strip.

"The dollar amount on the tables at any one time here is higher than on any casino table anywhere in the world," said Madding. "The average off-the-street gamblers here spend as much money in one night as those we would consider high-rollers in Las Vegas. "Nobody has seen anything like this."

Casino operator holding off Las Vegas rivals

By Le-Min Lim
BLOOMBERG NEWS

Stanley Ho, the billionaire who lost his four-decade Macau gaming monopoly in 2002, hasn't let new competitors such as Las Vegas Sands Corp. shake his dominance of a gambling market forecast to match Las Vegas's by 2008.

The 25-year-old Casino Lisboa, Ho's flagship, has averaged HK$50 million ($6.4 million) in daily gross gaming revenue since Sands opened Macau's first Vegas-style casino in May 2004, said Manuel Joaquim das Neves, director of the Chinese city's Gaming Control Board. Daily spending has averaged HK$20 million at the $265 million Sands, which has 30 percent more gaming tables and four times more slot machines than the Lisboa.

Ho, 83, is staying ahead because of his lock on Macau's so-called VIP market, which consists of about 4,000 gamblers -- mostly from mainland China -- who bet an average $1 million per visit, Neves said. They accounted for 70 percent of Macau's $5.1 billion in gaming revenue last year, he estimated.

"Stanley Ho dominates the VIP market," Neves, 45, said in an interview. "He has the contacts, and he has a huge head start in the business."

At the Lisboa's 36 VIP rooms, which bear names such as Golden Palace and Gold Court, bets start at HK$1,000 and there's no upper limit, said Cheong Kong Fai, a manager at the casino. Gamblers wagering at least HK$100,000 per bet get perks such as free gaming chips and nights at Ho's adjoining Hotel Lisboa.

Ho faces a new wave of competition from casino and hotel operators targeting a broader clientele as Macau, a former Portuguese enclave and the only place in China where casinos are legal, opens its gaming market.

Tourist arrivals to the city, an hour from Hong Kong by ferry, rose 45 percent to a record 16.7 million last year, and gaming revenue rose 43 percent, according to government figures. The city's economy expanded a record 28 percent.

Macau casinos generate more cash than their Las Vegas counterparts. Sands's flagship Venetian Casino Resort in Las Vegas earned $321 million in gross gaming revenue in 2004, according to the company. That's an average $879,452 a day -- one-seventh the Lisboa's $6.4 million daily revenue and about one-third the Sands Macau's $2.6 million, according to the figures provided by Neves.

So far, Ho's 13 casinos have two competitors: Sands and Galaxy Casino SA, a privately held casino operator controlled by Hong Kong construction tycoon Lui Che-woo that opened a $62 million Macau casino in July.

Competitors are expanding. Sands said in February 2002 after it won a concession license from Galaxy that it would build a second Macau casino replicating its Venetian-themed Las Vegas resort. The $1.8 billion Macau Venetian Casino Resort, scheduled to open in the first quarter of 2007, will feature 3,000 suites, 850,000 square feet of retail space and artificial canals and gondoliers.

Sands is targeting Macau high rollers with the invitation-only Paiza Club, where customers who bet more than HK$10,000 a hand get free use of private jets, limousines and cigar bars, according to the casino's Web site. The Sands Macao led a 69 percent gain in Sands's first-quarter revenue, the company said on May 3.

Sands is joining with hotel operators including InterContinental Hotels Group Plc and Four Seasons Hotels Inc. to develop a $12 billion Las Vegas-themed gambling strip in Macau, Chief Executive Sheldon Adelson, 71, told a Macau press conference on March 18.

"It took 75 years for Las Vegas to emerge as an international destination," Sands President William Weidner, 60, said in a press release the same day. "Our intention is to replicate that feat in less than three years."

Las Vegas casino operator Wynn Resorts Ltd., led by Steve Wynn, also plans to build a Macau resort. The company said in a May 4 statement it would add a $345 million wing to the $700 million Macau casino it plans to open in 2006, almost doubling casino space and adding two restaurants and a theater. Wynn has its own license and does not operate on a concession.

Rising competition may erode Ho's share of Macau's casino market in coming years.

Sociedade de Jogos de Macau, which controls the Ho family's gaming assets, will account for about 60 percent of the city's gambling revenue in 2009, down from 86 percent in 2004, Andes Cheng, an analyst at Hong Kong-based South China Finance & Management Ltd., estimates.

Las Vegas casino operators are better able to attract visitors seeking an overall tourist experience, said Karen Tang, a Hong Kong-based analyst at Deutsche Securities Asia Ltd.

"Ho has to adapt or lose his lead," Tang said. "He's losing out on Macau's fast-growing mass-market gaming segment."

To meet the challenge of Vegas-style casinos, Ho is building one of his own.

Sociedade de Jogos de Macau, known as SJM -- controlled by Ho's 42-year-old daughter, Pansy Ho -- last year formed a 50-50 venture with Las Vegas-based MGM Mirage to build the $975 million MGM Grand Macau, due to open in 2007. MGM Mirage said in a statement that the waterfront casino will boast private villas, a spa and 1,000 slot machines.

Pansy Ho declined a request for an interview, according to Janet Tong, a spokeswoman for Shun Tak Holdings Ltd., the Ho family's Hong Kong-listed transportation and property company. Janet Wong, a spokeswoman for Stanley Ho, didn't reply to a request for comment from him.

To cement its lead in the high-roller market, the Ho family is investing in Macau's first six-star casino resort. Melco International Development Ltd., headed by Ho's son Lawrence, 28, is building the HK$1.45 billion Park Hyatt resort on Macau's Taipa island with Australian billionaire Kerry Packer's Publishing & Broadcasting Ltd.

"We are combining their international management skills with our local connections," Lawrence Ho said in an e-mailed response to questions. "We understand the Chinese people and the culture of the Chinese market."

The waterfront resort, which will be managed by Chicago-based Hyatt Hotels Corp. and is set to open next year, will feature "hyper luxury decor" to attract VIP gamblers, Lawrence Ho said in an April 8 statement.

Even as the Ho family's stranglehold on the Macau gaming market comes under threat in coming years, its stakes in Macau businesses spanning from ferries to department stores ensure that he'll profit from the city's boom.

Stanley Ho's flagship company -- privately held Sociedade de Turismo e Diversoes de Macau SARL -- owns assets including Macau's only television station, its No. 2 bank, a stake in its international airport and the Macau Tower, the city's tallest building.

Shun Tak Holdings, whose high-speed Hong Kong-Macau ferry controls 90 percent of the market, reported a 54 percent gain in 2004 profit as travel to Macau surged. Shun Tak's Hong Kong- listed shares have more than doubled in the past year.

SJM plans to spend HK$6.2 billion to build a shopping, residential and commercial complex near Macau's ferry pier, the Hong Kong Economic Times reported on May 4, citing Ho. The project, called Oceanus, will be shaped like a ship's foredeck and feature 800 serviced apartments, office space and a 1 million- square-foot entertainment area.

"Stanley Ho's non-casino gaming assets in Macau will continue to perform regardless of what happens to his gaming business," said Jonathan Galaviz, a partner at Galaviz Ong & Co. in Las Vegas, which tracks the gaming industry. He forecasts that Macau's gaming revenue will match that of Las Vegas, the world's No. 1 gambling destination, by 2008.

Some Macau casinos catering to VIPs are used by criminal gangs to launder money, the U.S. State Department said in a March 1 report to Congress.

MACAU is the hottest piece of gambling real estate in Asia just now and Kerry Packers move to set up a second casino there is a sure bet almost, judging by reaction to his latest deal.

The proposal by Australias richest man, in conjunction with the son of Hong Kong billionaire Stanley Ho, to open a huge casino on the booming Cotai Strip in the former Portugese colony won plenty of support from investment analysts yesterday, although none were gauging earnings impact until further information becomes available.

Investment house UBS said the securing of a position on the Cotai Strip was a positive for PBL.

“We believe the prospects for the Macau gaming industry are strong, fuelled by a significant increase in capacity, a large part of which is being targeted at new market segments,” a UBS research note said.

Citigroup Smith Barneys analysts were “excited by the blue sky in Macau”, though sounded a cautionary note about the returns from the Cotai gambling business, where, according to press reports, up to 20 major casinos could be in operation by 2010.

Cotai, a strip of reclaimed land between the Macanese islands of Taipa and Coloane, is joined to the Chinese mainland by a bridge.

Major US casino operator Sheldon Adelson, owner of the Las Vegas Sands Corp, and his major rival Steve Wynn, are both undertaking multi-billion dollar developments in Cotai already.

Analysts have concerns about the expected quality of returns from the less wealthy, poker machine-focused gamblers expected in Cotai compared with the wealthier gamblers attracted to operations such as PBL-Melcos first Macau casino at the Park Hyatt hotel.

PBL-Melco are proposing an underwater casino hall for Cotai capable of housing 450 gaming tables and 3000 poker machines, plus two blocks of deluxe serviced apartments, two four-star hotels, a five-star hotel, a shopping mall and a performance hall.

Mr Michael K.M. Chan, Vice President of Greek Mythology (Macau) Entertainment Group Corporation Limited was interviewed by The Standard recently to discuss the business performance and development plan of the newly opened Greek Mythology Casino. The following is the abstract of the interview:

Goddess of good luck

Greek Mythology has taken many people’s fancy throughout the centuries. Restaurants, theaters and even discos have used the Greco-Roman designs to give their establishments a classic touch.

But it was not until the Greek Mythology Casino, which Hong Kong public- listed A-Max Holdings Limited (HKSE: 959) holds 16% of, took up the theme that its spirit and charm were fully realized, which is very attractive to mainland travelers who have less chance to travel to Europe.

Greek Mythology (Macau) Entertainment Group Corporation Limited opened the new Greek Mythology Casino at New Century Hotel on December 23, 2004. The first phase of this integrated casino and entertainment project has a total gross floor area of 160,000 square feet and called for an investment of HK$600 million.

Design, construction and fitting out of Greek Mythology Casino took six months to complete. It opened with 228 gaming tables in the first phase, with a further expansion to 500 tables on an area of 300,000 square feet scheduled for 2005. In the third phase, a new 38-floor hotel wing will be built to house another 500 gaming tables in 2007. Greek Mythology has also spent a substantial amount to provide free entertainment performances, including Moulin Rouge, for visitors to enjoy.

It is Macau’s second largest casino, next to the Sands, in terms of size and headcounts. ’’It has attracted a flow of 20,000 to 30,000 people on a daily basis,’’ Chan said proudly. ’’And the headcount is still increasing.’’

’’We are fortunate to have Mr. Ng Man Sun as our controlling shareholder,’’ Chan pointed out. ’’He has more than 30 years of gaming experience in Macau and the Philippines, and is the owner of New Century Hotel.’’ Mr. Ng is also the single largest shareholder of A-Max Holdings Limited.

Instant Profits

Ng’s keen eye on the gaming industry has helped Greek Mythology succeed. However, speaking of the ’’Macau-concept stocks," Chan stressed that the Group has always been focused on practical business operations to avoid intentional speculations.

’’We were already making profits on the first day of operation,’’ Chan declared. ’’I guess there would not be many other types of business with such a promising prospect. We had set our research and marketing strategies precisely right at the beginning.’’

Overseas Expansion

Regarding the gaming business, the Group is destined to expand both in and out of Macau, including other Asian countries and the USA. Besides, the group will seek to develop another new casino in addition to existing expansion plan.

Cross-boundary Ferry Pier

’’It is set to become a new icon representing a closer link to Macau and mainland China through Tuen Mun,’’ Chan said. ’’The pier will be a new development to capture the increasing demand of cross-boundary services to Macau and mainland China from a location in the western New Territories.’’

The proposed development, according to Chan, would be a new Tuen Mun landmark, and is expected to be launched between 2005 and 2006. While having the attributes of a new landmark structure, the proposed pier harmonizes unobtrusively with the surrounding environment.

Daniel Schultz places a call through to his account manager in Costa Rica and clears a huge bet that he then puts on red in one of the glitzy new casinos in the southern Chinese territory of Macau.

No money changes hands, neither do any chips. There isn't even a roulette table nearby.

In fact, the whole transaction is conducted over a mobile phone - in the cafe.

This is the future of gambling Macau-style, a far cry from the smoky, seedy dens that used to rule the roost in this former Portuguese enclave that has been Asia's gambling haven for more than a century.

Schultz is demonstrating the latest innovation from Realtime Gaming, an American company that claims to be able to put the thrill of the punt into a computer, a phone, even into a console.

It plans to put computer-linked flat-screens in the unused corners of the city's casinos, allowing operators of the fast-proliferating gaming rooms to "monetize" every spare bit of space with online gambling consoles.

Realtime Gaming is just one of hundreds of overseas companies looking to cash in on the mushrooming casino business here. Dozens of them gathered for the city's first ever casino-supply expo two weeks ago and a similar event to be held in June is expected to attract 300 firms.

Security equipment suppliers, LED screen builders, caterers and construction contractors are among the latest wave of businesses to join the clamor for Macau gold after the initial rush of casino operators, including MGM Mirage and Wynn Resorts, and hotel management firms, such as Starwoods.

When the city reverted to Chinese rule five years ago, such foreign interest in the tiny southern territory would have been unthinkable.

But Macau has changed, especially since May 18 last year when the first American casino opened in what had until then been a Chinese-only gambling sector.

Sands Macau, owned by the Las Vegas casino giant that owns the hugely popular Venetian, brought glitz and glamour to a casino industry that had been dominated for 40 years by the down-at-heel gaming halls of tycoon Stanley Ho.

Among the new proposals is a score of casino-hotel complexes on a huge reclamation, which, when complete, is expected to pull in more money than all the resorts on the Las Vegas strip.

With a sudden surge in mainland Chinese tourists fuelling this growth, Macau is now big business and everybody is trying to get a piece of the pie.

"I predict that within a few short years about 25 percent of all our casino business will be in Macau - that's from very little now," said Scott Madding, international casino sales manager for the United States Card Company.

With each casino in the city consuming some 20,000 cards each night, his company sees huge gains in the new Macau.

This is the kind of talk the city's financial bosses love. When they decided to reinvigorate the ailing sector by relaxing foreign ownership rules for casinos three years ago, vested interests that opposed the move were placated with promises that the entire city would benefit in the long-run.

Financially, it has gained in a very short space of time. Last year, increased gambling receipts earned the city's Beijing-backed administration 15.2 billion patacas (US$1.94 billion).

The industry is proving such a money-spinner that by the middle of last year, revenue from gambling taxes had already paid off the city's 13-billion pataca public-spending budget for last year.

Residents were rewarded with tax cuts and the colossal civil service with pay rises.

Foreign companies are being lured by the huge earning potential of Macau's handful of casinos. Last year they pulled in some 42 billion patacas, the equivalent of the earnings made in all the casinos on the Las Vegas strip.

"The dollar amount on the tables at any one time here is higher than on any casino table anywhere in the world," said Madding. "The average off-the-street gamblers here spend as much money in one night as those we would consider high-rollers in Las Vegas. "Nobody has seen anything like this."

MACAO, Special Administrative Region of the People's Republic of China, May 19 /PRNewswire-FirstCall/ -- Las Vegas Sands Corp. (NYSE: LVS - News), and its subsidiary Venetian Macau Limited (VML), announced today that Wolfram Diener will join the organization in June 2005 as vice president of convention and exhibition for the convention and expo center being built at The Venetian Macao Resort Hotel Casino on the Cotai Strip(TM). Mr. Diener will also be responsible for trade show operations for the company in Macao.

Mr. Diener brings to the company twenty years of international convention center and marketing experience. During this time, Mr. Diener has held leadership positions with convention and trade show operators in Europe and Asia. Most recently, Mr. Diener was the general manager of Shanghai New International Expo Center Co., Ltd (SNIEC), one of the busiest venues of its kind in Asia-Pacific. Prior to his position at SNIEC, Mr. Diener was the managing director of the noted trade show organizer, Messe Frankfort.

Mr. Diener will oversee all operations of VML's Venetian Macao Convention and Expo Center as well as the overall planning and management of VML's trade show operations.

"Wolfram is an excellent addition to our world renowned management team and his knowledge and experience will be an important asset to our continued success. He brings a strong track record of success and in welcoming Wolfram to VML it is a clear signal of our belief in the potential of the Convention and Exhibition market in Macao," said Frank McFadden, chief operating officer of Venetian Macau Limited.

"It is extremely gratifying to be joining the world's premier resort and gaming company. The opportunities in Macao are extraordinary, particularly in the Convention and Exhibition arenas, and I very much look forward to helping VML capitalize on them," said Mr. Diener.

China's Macao Special Administrative Region has seen a 23 percent increase of revenue from gaming taxes during the first four months over the same period last year, local media reported Thursday.

The Macau Post quoted sources from the Finance Services Bureau as saying that the government received 5.27 billion patacas (630 million US dollars) from the casino-gaming industry during the period.

Gaming taxes generated 78 percent of the government's revenue, which totaled 6.75 billion patacas (820 million US dollars) from January to April, the newspaper reported.

Macao's 17 casinos pay 35 percent of their gross revenue as direct tax to the government, it added.

Macau Success, a cruise ship operator chaired by tycoon Albert Yeung's younger brother Sonny Yeung, expects to recoup the investment in its Ponte 16 project in less than two years after lifting its stake.

The project, an entertainment complex that includes a casino with at least 150 gaming tables, a hotel with 200 rooms and 20 VIP mansions and shopping malls, is estimated to cost HK$1 billion, said executive director Marco Lee.

The company said it will pay HK$99.25 million in cash for another 12.25 percent of the project, lifting its stake to 36.75 percent, and may further increase that.

Its investment in the project will be HK$367.5 million, based on the stake it holds.

``The investment will be settled through internal resources,'' said Lee. ``We have sufficient [resources] to pay the planned capital we need this year and fund raising will be our last resort.''

Macau Success has cash of HK$400 million, but Lee refused to give details on estimated capital expenditure.

Revenue generated from the casino, to be completed by the end of next year, will fund construction of the hotel, shopping arcades and car parks.

Lee expects the casino will contribute more than 60 percent of total turnover while the hotel and shopping mall will make up the remainder by the time the project is completed in 2007.

``The gaming tables are increasing, but the growth will slow down and the numbers will be steady by 2006-2007,'' said financial controller Simon Luk.

Macau Success shares rose by up to 6.2 percent Friday after the firm said it will increase its stake in the Ponte 16 project. The stock closed at HK$0.84, up by 3.7 percent.

How many casinos and their names are currently operated in macau and how many more expected to be opened in the future?

How many casinos and their names are currently operated in macau and how many more expected to be opened in the future?

Currently about 20, not sure in the future and i think its probably about 15 more under construction

Currently about 20, not sure in the future and i think its probably about 15 more under construction

Confirm to build casino:

Built by SJM, Melco & Shuntak
Casino Grand Lisboa
Oceanus Casino
Ponte 16
Macau Fisherman's Wharf
Nam Van Lake Item's Casino (Shuntak)
Casino Park Hyatt (Melco)
Casino City of Dreams (Melco)
Nova Taipa Gardens Hotel Item(Shuntak, no confirm)
Baia de Nossa Senhora de Esperanca(Shuntak, no confirm)

** Built by other company, but the Casino is "SJM"
Emperor Casino
Greek Mythology Casino expansion
Casino Presidente
Macau Arc of Triumph (no confirm)
------------------------------------
Built by MGM
MGM Grand Casino
------------------------------------
Built by Galaxy
Rio Casino
StarWorld Casino
Contai Casino
Galaxy Mega Resort Casino (Phase 1-4)
------------------------------------
Built by Venetian
Venetian Resort Casino
Contai Strips other casino (Phase 2-7)(eg: Dorsett, Regel)
------------------------------------
Built by Wynn
Macau Wynn Casino

do you have more info on this?
國際娛樂（８１１８）擬投資１５億元改建澳門凱旋門
5月 17日 星期二 09:28 更新

《經濟通專訊》據《信報》引述消息人士報道，國際娛樂（８１１８）擬斥資１５億元，將原來計劃興建３０多層的澳門賭場項目－－凱旋門，改建為６０多層高的建築物，落成後將成為澳門最高的大廈。

報道指，縱然凱旋門的樓層可以增加，但總樓面面積並沒有提升。至於１５億元的項目總投資，其中９億元作地價，其餘則用作建築費用

^^ Never heard of it before ..

The chairman of Malaysian casino and hotel operator Genting Group, Lim Kok Thay, has increased his stake in Macau gaming play K Wah Construction Materials.

According to a statement to Hong Kong Exchanges and Clearing, Mr Lim acquired 19.05 million shares of K Wah for $ 126.88 million on the open market, lifting his stake to 6.01 per cent from 4.69 per cent.

Last month, Mr Lim, who is also chairman of Hong Kong-listed Star Cruises, bought about 67 million shares at $ 8 each through K Wah's 146 million share placement.

The company raised $ 1.16 billion from the offering to help fund its planned $ 18.4 billion acquisition of Galaxy Casino in Macau.

Gabriel Chan, an analyst at Credit Suisse First Boston, said Mr Lim's private investment indicated a growing interest in Macau's gaming business.

"Macau's outlook seems more exciting than Malaysia's," Mr Chan said.

As K Wah stacks its chips against big international casino operators such as Venetian Group, Wynn Resorts and Kerry Packer, Mr Chan said Mr Lim's experience would come in handy for Galaxy Casino.

Genting group operates the Highlands Resort in Malaysia, which includes a casino, convention centre, 6,500 rooms in six hotels and a golf course.

The Singaporean government has invited a Genting consortium to participate in the second round of bidding for a S$ 5 billion ($ 23.4 billion) integrated casino resort in the city state. Other members of the consortium include Genting affiliate Star Cruises and United States entertainment giant Universal Studios.

Yesterday's stock exchange statement said Mr Lim bought 4.99 million shares of K Wah at an average of $ 6.33 per share last Friday, and an additional 14.06 million shares at an average of $ 6.77 each on Monday.

K Wah shares yesterday rose 0.78 per cent to close at $ 6.45.

MACAU, May 30 /Xinhua-PRNewswire-FirstCall/ -- Leading Macau gaming and entertainment group Greek Mythology Casino today reported strong performance for its new casino in Macau since its opening on December 23, 2004. In the first 4 months of 2005, Greek Mythology Casino registered net gaming income of over MOP234 million (net of gambling taxes of about 40 percent and concessions paid). Monthly net gaming income at the casino has jumped from MOP40 million at the beginning of the year to more than MOP70 million in March and MOP80 million in April, while the monthly operating costs were kept stable at several million MOP. The casino had invested more than MOP600 million in the first phase development. In view of the revenue growth trend in the past months, management expects that the first phase investments can be early paid off this year.

Since its opening in December 2004, Greek Mythology Casino's traffic has increased significantly to approximately 30,000 visitors daily in the recent month. The basement floor of the New Century Hotel is reserved for the second phase development of Greek Mythology Casino. The second phase of the casino will have a total floor area of 37,000 sq ft, of which 20,000 sq ft will be reserved for the building of more VIP rooms.

Four newly renovated VIP rooms are now in test operation and currently contributing significantly to the casino's gaming income.

Mr Michael Chan, Vice Chairman of Greek Mythology Casino, said: "We are much encouraged by the robust performance of the casino and will speed up the expansion of VIP rooms and slot machines. Upon regulatory approval, we plan to add more VIP rooms to our casino shortly."

Hong Kong public listed A-Max Holdings Limited (HKEx: 959) is the second largest shareholder of the casino. On May 18, 2005, Greek Mythology repurchased a total of 19.95% equity interests in the casino from its major shareholder Mr Ng Man Sun and two other minority shareholders. The exercise resulted in an increase in the stake of A-Max in Greek Mythology Casino from 16% to 19.99% at no cost. Greek Mythology also announced plans to continue the negotiations with its shareholders regarding the feasibility of further repurchases.

Mr Ng Man Sun is the single largest shareholder of A-Max Holdings Limited and New Century Hotel, Macau.

Jose Ho


June 3, 2005


The dealer shortage hampering casino expansion in Macau should ease soon as residents eager to work in the gaming industry continue to flood government-financed training courses.

The Macau Tourism and Casino Career Centre received more than 2,300 applications for the 600 slots in its present four-month session. Consequently, the center will fill its next class directly from the backlog.

``Many people are interested in working in the gaming industry,'' said executive director Raymond Chan. ``Being a dealer is a high-paying job but people must prepare themselves for the stress of the casino setting.''

Casinos due to open in the next two years will need 6,000 to 8,000 dealers, he forecast. Thanks to an operating subsidy of 45 million patacas (HK$43.7 million) from the government, the center charges no tuition but is only open to Macau residents. But it receives many Hong Kong inquiries.

``We don't have plans to accept students from Hong Kong,'' Chan said. ``We will study the market closely and work in accordance with government policy.''

The government officially requires casinos to show preference to residents for dealer positions, but casino executives say, in practice, they are allowed to hire only locals. At year end, Macau casinos had 4,646 vacancies fordealers, and similar positions.

Gaming Inspection & Coordination Bureau director Manuel Joaquim das Neves said casinos are forbidden to hire mainlanders as dealers to avoid conflict with China's anti-gambling law.

Some commentators have blamed last year's 22 percent increase in the school dropout rate on the allure of dealer jobs, but Chan said ``since gaming is the leading industry of Macau, we should encourage more young people to join.''

Macau dealers earn 13,000 to 15,000 patacas a month, with tips. Macau's monthly median wage in the first quarter was 5,680 patacas.

More banks join financing for Macau casino projects
Tim LeeMaster, Hong Kong Standard
June 13, 2005

Venetian Macau, backed by Las Vegas magnate Sheldon Adelson, is seeking debt financing for its flagship casino set to open in 2007 while rival Wynn Macau has arranged cheaper funding on the second round of financing for its expanded Macau casino development as lead bankers try to double the number of banks in the syndicate group, bankers familiar with the situation said.

Goldman Sachs and Lehman Brothers will lead the new round of financing for the Venetian project that could run as high as US$900 million (HK$7.02 billion) in loans and bond sales.

The search for funding comes just after the finance arm of Venetian Macau paid off US$120 million in bonds it had sold two years ago to finance construction of the popular Macau Sands casino, which Adelson opened in May of last year and paid for itself in record time on the back of strong gambling revenue. The buyback cost the company US$121.9 million, including accrued interest due bondholders.

The 2003 bond sale was also run by Goldman Sachs with a syndicate that included two local banks in Macau and Scotia Capital, the investment banking arm of Canadian Bank of Nova Scotia. The bonds yielded 4 percent, bankers said.

The Venetian is the most expensive casino project to date in Macau, with a total projected cost of US$1.8 billion. The resort is modeled after Adelson's successful Venetian Las Vegas, a faux rendering of the fabled Italian trading city complete with canals and gondoliers. It will also house luxury shopping malls and a classical art museum.

When it opens, the hotel will contain 1,500 suites while the casino will house 585 gaming tables with 5,000 slot machines. A convention center, shopping complex and theaters are also planned. The company had spent US$48.6 million in capital expenditure on Macau projects through the end of March 2005, according to the company's most recent regulatory filling in the United States.

At the same time, Wynn Macau will pay an interest margin of 3 percent above the London interbank offered rate on the US$345 million loan it is seeking, bankers familiar with the situation said.

On this latest round of financing, a slew of major multinational investment banks such as Calyon Corporate & Investment Bank, HSBC, BNP Paribas - in addition to the original syndicate of banks from the first loan in September - are likely to join in the syndication, market sources said. Big name banks like these shied away from previous opportunities to fund Macau casino projects but are more interested this time around.

``The Sands is booming, MGM has broken ground and Singapore is coming on,'' a banker said. ``Everyone wants to get smart on how to do these deals.''

And now that several casinos have successfully financed projects, banks are becoming more comfortable with the idea of contributing funds. That's a big change from last year when lead arrangers Societe General and Deutsche Bank had to search high and low to find syndicate banks not scared off by the greenfield nature of financing a Macau casino. At that time, when Wynn Macau was seeking an initial US$397 million loan, the two banks, who are also leading the current deal, brought in two local Macau banks at the behest of the Macau government along with Allied Irish Bank, Korea First Bank, Hong Kong-based Canadian Eastern Finance, Japan's Aozora Bank, Germany's WestLB as well as Bank of China and Industrial and Commercial Bank of China (Macau).

The difficulty in arranging financing was one factor behind the higher 3.5 percent interest margin Wynn Macau had to pay then.

The new phase of Wynn Macau will include 150 tables, 500 slot machines, a sports betting area, two restaurants and a theater. Construction is scheduled to begin in the third quarter at a total cost of US$345 million, bringing Wynn's total investment in Macau to US$1.05 billion. Phase I, scheduled to open in autumn at a cost of US$704 million, will contain 600 hotel rooms, 200 gaming tables, 350 slot machines and seven restaurants.

Gaming revenues in Macau have grown 20 per cent this year
14 June 2005
South China Morning Post

Gaming revenues in Macau have grown 20 per cent this year, a long way from the 44 per cent recorded last year, says Marc Falcone, the managing director of North America Equity Research at Deutsche Bank Securities.

This had led to a shift in expectations in the United States for the enclave's future receipts, he said.

Deutsche forecasts that Macau's gross receipts will remain at that level for this year. Mr Falcone said the figures had been below expectations. He was speaking before today's start of a two-day Asian Gaming Expo in Macau, sponsored by the bank.

With most of the big-name casino-resort projects not due for completion until 2006 to 2009, Mr Falcone said the Sands Macau operation had produced strong results.

Since opening in May last year, it had recorded a 71/2-month tally of $3.11 billion and net earnings of $952 million for the year to December.

"The US market is trying to understand what the future holds for Macau. Investors are more cautious in the transitional period between 2004 and until the major projects are completed," he said.

Analysis - Turning Macau Into the Last Vegas of Asia
Tuesday June 14, 2005, 3:29 pm
(Analysis from Asia Today, Australia's regional business magazine. Contact: asiatoday.com.au

HONG KONG, June 14 Asia Pulse - Close to an estimated US$7.4 billion worth of developments, centred around entertainment and casinos, has transformed the sleepy backwater of Macau into a hive of activity.

China's strategy is to turn Macau into the Las Vegas of Asia, according to a report by Hong Kong-based UBS Investment Research, Macau Gaming - Let the Games Begin. It says the political incentive is driven by the upcoming 10th anniversary of Macau's handover to China in 2009. UBS says a common language, proximity (with a billion people within three hours flight time), and a limited variety of entertainment avenues in China, give Macau the social advantage.

The report adds that China's economic growth provides sustainable finance for gaming pursuits in Macau. Last year, Macau earned US$5.4 billion from gaming - narrowly beating the Las Vegas Strip (US$5.3 billion) as the world's largest gaming centre.

A pivotal decision by the Macau Government - to end a 40-year monopoly on casino operations in 2002 by granting three new licences - triggered the current development boom in Macau.

Two of the new licenses went to new players - Wynn's Resorts from Las Vegas, and Galaxy Consortium, controlled by the Hong Kong group K-Wah. As well, several sub-concessions were issued, including one to Las Vegas Sands, whose Chairman, Sheldon Adelson, last month unveiled plans to build a US$15-billion replica of the Las Vegas Strip on Cotai Strip in Macau. (Cotai is the reclaimed land between two islands - Coloane and Taipa). Sheldon told Hong Kong reporters the strip could have as many as 60,000 rooms.

The strip has been carved into seven parcels of land. At this stage, six hotels, each supported by a casino, are planned, with leading hotels groups including Starwood, Marriott, InterContinental, Regal and Four Seasons committed to plans collectively worth US$2. 5 billion.

Several Australian companies have already tapped into opportunities in Macau. These include WT Partnership, a quantity surveying firm; Meinhart, an engineering firm, the Sanderson Group, a theme park designer and contractor; and Leighton Asia (Northern), part of the Leighton Group.

The Australian Gaming Manufacturers Association plans to hold its trade exhibition in Macau in June. Ross Ferrar, the Association's Chief Executive, says members including Aristocrat, Ainsworth Machines and Stargames are already exporting slot machines to casinos in Macau.

Such are the prospects for Australian companies that the Australian Chamber of Commerce in Hong Kong has set up a chapter in Macau to service the growing number of Australians working there.

Macau's economy grew 25 per cent last year, says Mark Wood, Austrade's Trade Commissioner responsible for Macau. Growth is being driven by the arrival of Chinese tourists. Macau and Hong Kong have benefitted greatly since Beijing decided to lift restrictions on travel to the two SARs last year. Individuals can travel to both Hong Kong and Macau without joining an official tour group.

Wood says some 15-20 million tourists visited Macau last year. When put into the per capita context of Australia's population of 21 million, it means a staggering 600 million tourists. Wood says the average stay of the Chinese visitors is 1. 25 days. The strategy of the Macau Government is to double that stay, but currently there are not enough hotel rooms. He says it will probably take five years before Macau has enough rooms to meet the anticipated increase in tourist arrivals. As the new hotels get up and running, Wood says a major concern will be sourcing of fresh produce - including seafood, vegetables and fruit. "We are working to develop a supply chain to hotels in Macau," he says.

Australia is currently a leading supplier of fresh food produce and wines to hotels in Hong Kong.

As well as casinos and hotels, a wide range of entertainment facilities will be built in Macau in coming years to liven up tourist attractions in the former Portuguese enclave.

Aside from construction of the casinos /hotels/entertainment complexes, Wood says Macau will need additional housing, hospitals, schools and other facilities to house its growing population. Macau has a population of 500,000 and will have to rely on migrant workers to fill newly-created jobs. There will be a need for both education offshore and new joint ventures with vocational schools in Macau to train new workers. Macau has already started to import workers from the Philippines and India, according to sources.

The second area is the civil service, Wood says. The Government has had to adjust its civil service infrastructure to deal with the huge volume of work coming from the waves of activity. It will have to issue work permits for thousands who arrive to work in Macau's casinos and construction sector, deal with new licences and monitor the industry.

Wood says Australia can play a role in helping train more Macau people to cope in areas such as licensing and monitoring. A team from the Macau public service arrived in Australia recently to see how Australia's Centrelink system works. Macau needs to move to electronic government to keep pace with development. The Government hopes to deliver more services online and to streamline of its call centres.

June 16, 2005


Melco International Development, a Hong Kong-listed company controlled by the family of tycoon Stanley Ho, said its Mocha Slot unit is beating electronic gambling rivals in Macau.

Melco managing director Lawrence Ho said Mocha is capturing 38 percent of slot machine revenues with only 25 percent of the territory's machines.

Ho told a gambling industry conference in Macau Wednesday that Mocha's 647 machines generated an average HK$1,760 a day last month, while the Sands Macau's 859 machines made HK$1,300 a day and the Galaxy Waldo's 60 machines generated HK$1,020 daily.

He said Sociedade de Jogos de Macau, under whose license Mocha operates, generated HK$610 a day from 1,071 machines it controls outside of the Mocha partnership.

Ho attributed part of Mocha's success to its customer loyalty program, which has signed up 10,000 members in three months, of whom 60 percent he termed ``active members.'' Members, who insert personal cards into machines they play to earn bonus rewards, are targeted with promotions about new games and locations.

Mocha, a venture with Australia's Publishing & Broadcasting in which Melco owns a controlling stake, opened its fourth slots lounge in March in the Hotel Taipa Square.

Ho said he plans to open seven more locations by the end of next year, bringing Mocha's total number of machines up to 2,500.

Separately, Andy Nazarechuk, a hospitality professor from the University of Nevada Las Vegas who acts as a casino consultant, told the conference he expects annual gambling revenue in Macau to reach US$20 billion (HK$156 billion) by 2010 and related non-gambling revenue to reach US$30 billion. He said he expects Macau to attract 40 million annual visits by that time.

Casino operator Las Vegas Sands Corp on Monday said it had paid off its outstanding $120 million debt secured by mortgages on assets at its year-old Sands Macao Casino.

The company said the casino, located in the Chinese gambling enclave of Macau, had generated sufficient excess cash flow in its first year of operation to allow it to pay off the debt early.

The $120 million of floating rate notes due in 2008 were originally issued in 2003.

HONG KONG - Close to an estimated US$7.4 billion worth of new development, centered around entertainment and casinos, has transformed the sleepy backwater of Macau into a hive of activity.

China's strategy is to turn Macau into the Las Vegas of Asia, according to a report by Hong Kong-based UBS Investment Research, "Macau Gaming - Let the Games Begin". It says the political incentive is driven by the upcoming 10th anniversary of Macau's handover to China in 2009. UBS says a common language, proximity (with a billion people within three hours' flight time), and the limited variety of entertainment venues in China, give Macau a competitive advantage. The report adds that China's economic growth provides a sustainable base for gaming enterprises in Macau. Last year, Macau earned US$5.4 billion from gaming - narrowly beating the Las Vegas Strip (US$5.3 billion) as the world's largest gaming center.

A pivotal decision by the Macau government - to end a 40-year monopoly on casino operations in 2002 by granting three new licenses - triggered the current development boom in Macau. Two of the new licenses went to new players - Wynn's Resorts from Las Vegas, and Galaxy Consortium, controlled by Hong Kong group K-Wah. Several sub-concessions were also issued, including one to Las Vegas Sands, whose chairman, Sheldon Adelson, last month unveiled plans to build a $15-billion replica of the Las Vegas Strip on the Cotai Strip in Macau (Cotai is the reclaimed land between two islands - Taipa and Coloane). Sheldon told Hong Kong reporters the strip could have as many as 60,000 rooms.

The strip has been carved into seven parcels of land. At this stage, six hotels, each supported by a casino, are planned, with leading hotel groups, including Starwood, Marriott, InterContinental, Regal and Four Seasons committed to plans collectively worth $2. 5 billion.

Several Australian companies have already tapped into opportunities in Macau. These include WT Partnership, a quantity surveying firm; Meinhart, an engineering firm; the Sanderson Group, a theme park designer and contractor; and Leighton Asia (Northern), part of the Leighton Group. The Australian Gaming Manufacturers Association plans to hold its trade exhibition in Macau in June. Ross Ferrar, the association's chief executive, says members including Aristocrat, Ainsworth Machines and Stargames are already exporting slot machines to casinos in Macau. Such are the prospects for Australian companies that the Australian Chamber of Commerce in Hong Kong has set up a chapter in Macau to service the growing number of Australians working there.

Macau's economy grew 25% last year, says Mark Wood, Austrade's trade commissioner responsible for Macau. Growth is being driven by the arrival of mainland Chinese tourists. Macau and Hong Kong have benefited greatly since Beijing decided to lift restrictions on travel to the two special administrative regions (SARs) last year. Individuals can travel to both Hong Kong and Macau without joining an official tour group.

Wood says some 15-20 million tourists visited Macau last year. If a similar level of tourism per capita occurred in Australia, it would mean a staggering 600 million tourists a year. Wood says the average stay of Chinese visitors is only 1.25 days. The strategy of the Macau government is to double that stay by providing more attractions, but currently there are not enough hotel rooms. He says it will probably take five years before Macau has enough rooms to meet the anticipated increase in tourist arrivals. As the new hotels get up and running, Wood says a major concern will be the supply of fresh produce - including seafood, vegetables and fruit. "We are working to develop a supply chain to hotels in Macau," he says. Australia is currently a leading supplier of fresh food produce and wines to hotels in Hong Kong.

As well as casinos and hotels, a wide range of entertainment facilities will be built in Macau in the coming years to liven up tourist attractions in the former Portuguese enclave. Aside from construction of the casinos, hotels and entertainment complexes, Wood says Macau will need additional housing, hospitals, schools and other facilities to house its growing population. Macau has a population of 500,000 and will have to rely on migrant workers to fill newly created jobs. There will be a need for both education offshore and new joint ventures with vocational schools in Macau to train new workers. Macau has already started to import workers from the Philippines and India, according to sources.

The second area is the civil service, Wood says. The government has had to adjust its civil service infrastructure to deal with the huge volume of work coming from the waves of investment activity. It will have to issue work permits for the thousands of workers who will arrive to work in Macau's casinos and construction sector, deal with new licenses, and monitor the industry.

Wood says Australia can play a role in helping train more Macau people to cope in areas such as licensing and monitoring. A team from the Macau public service arrived in Australia recently to see how Australia's Centrelink system works. Macau needs to move to electronic governance to keep pace with development. The government hopes to deliver more services online and to streamline its call centers.

Other players in the gaming boom
Gaming in Asia is not only booming in Macau. Last month, Singapore gave the nod to two integrated resorts with casinos, to be built on Sentosa Island and a newly reclaimed area known as Marina Bayfront. Not to be outdone, the Philippines Amusement and Gaming Corporation (PAGCOR) plans a $15-billion project on reclaimed land on Manila Bay to rival Macau. Rafael Francisco, president of PAGCOR, said last year that he would like to speed up the project to catch up with Singapore and Thailand, which is planning an integrated resort at Khao Lak, near Phuket.

Austrade's Senior Trade Commissioner in Manila, Alan Morrell, says the idea is to make Manila a tourist attraction along the lines of Las Vegas, with a variety of entertainment, such as shows and rides. Apparently, potential investors have begun discussions with PACGOR. But as Austrade sees it, a major hindrance is the expiration of PAGCOR's charter in 2008. Investors would like to be assured that the government will extend PAGCOR's charter beyond 2008.

Negotiations are on hold until the Congress of the Philippines passes a bill extending PAGCOR's charter, probably for another couple of years. PAGCOR hopes the government will pass its bill this year, and is mindful that neighboring countries like Singapore have already announced their plans for casinos. Sources say that if the bill is not acted on quickly by Congress, the government's master plan for developing gaming may not proceed as envisaged - especially if potential investors start looking at neighboring countries as an option.

(Analysis from Asia Today, Australia's regional business magazine. Contact: asiatoday(at)asiatoday.com.au

Close to an estimated US$7. 4 billion worth of developments, centred around entertainment and casinos, has transformed the sleepy backwater of Macau into a hive of activity.

China's strategy is to turn Macau into the Las Vegas of Asia, according to a report by Hong Kong-based UBS Investment Research, Macau Gaming - Let the Games Begin. It says the political incentive is driven by the upcoming 10th anniversary of Macau's handover to China in 2009. UBS says a common language, proximity (with a billion people within three hours flight time), and a limited variety of entertainment avenues in China, give Macau the social advantage.

The report adds that China's economic growth provides sustainable finance for gaming pursuits in Macau. Last year, Macau earned US$5. 4 billion from gaming - narrowly beating the Las Vegas Strip (US$5. 3 billion) as the world's largest gaming centre.

A pivotal decision by the Macau Government - to end a 40-year monopoly on casino operations in 2002 by granting three new licences - triggered the current development boom in Macau.

Two of the new licenses went to new players - Wynn's Resorts from Las Vegas, and Galaxy Consortium, controlled by the Hong Kong group K-Wah. As well, several sub-concessions were issued, including one to Las Vegas Sands, whose Chairman, Sheldon Adelson, last month unveiled plans to build a US$15-billion replica of the Las Vegas Strip on Cotai Strip in Macau. (Cotai is the reclaimed land between two islands - Coloane and Taipa). Sheldon told Hong Kong reporters the strip could have as many as 60,000 rooms.

The strip has been carved into seven parcels of land. At this stage, six hotels, each supported by a casino, are planned, with leading hotels groups including Starwood, Marriott, InterContinental, Regal and Four Seasons committed to plans collectively worth US$2. 5 billion.

Several Australian companies have already tapped into opportunities in Macau. These include WT Partnership, a quantity surveying firm; Meinhart, an engineering firm, the Sanderson Group, a theme park designer and contractor; and Leighton Asia (Northern), part of the Leighton Group.

The Australian Gaming Manufacturers Association plans to hold its trade exhibition in Macau in June. Ross Ferrar, the Association's Chief Executive, says members including Aristocrat, Ainsworth Machines and Stargames are already exporting slot machines to casinos in Macau.

Such are the prospects for Australian companies that the Australian Chamber of Commerce in Hong Kong has set up a chapter in Macau to service the growing number of Australians working there.

Macau's economy grew 25 per cent last year, says Mark Wood, Austrade's Trade Commissioner responsible for Macau. Growth is being driven by the arrival of Chinese tourists. Macau and Hong Kong have benefitted greatly since Beijing decided to lift restrictions on travel to the two SARs last year. Individuals can travel to both Hong Kong and Macau without joining an official tour group.

Wood says some 15-20 million tourists visited Macau last year. When put into the per capita context of Australia's population of 21 million, it means a staggering 600 million tourists. Wood says the average stay of the Chinese visitors is 1. 25 days. The strategy of the Macau Government is to double that stay, but currently there are not enough hotel rooms. He says it will probably take five years before Macau has enough rooms to meet the anticipated increase in tourist arrivals. As the new hotels get up and running, Wood says a major concern will be sourcing of fresh produce - including seafood, vegetables and fruit. "We are working to develop a supply chain to hotels in Macau," he says.

Australia is currently a leading supplier of fresh food produce and wines to hotels in Hong Kong.

As well as casinos and hotels, a wide range of entertainment facilities will be built in Macau in coming years to liven up tourist attractions in the former Portuguese enclave.

Aside from construction of the casinos /hotels/entertainment complexes, Wood says Macau will need additional housing, hospitals, schools and other facilities to house its growing population. Macau has a population of 500,000 and will have to rely on migrant workers to fill newly-created jobs. There will be a need for both education offshore and new joint ventures with vocational schools in Macau to train new workers. Macau has already started to import workers from the Philippines and India, according to sources.

The second area is the civil service, Wood says. The Government has had to adjust its civil service infrastructure to deal with the huge volume of work coming from the waves of activity. It will have to issue work permits for thousands who arrive to work in Macau's casinos and construction sector, deal with new licences and monitor the industry.

Wood says Australia can play a role in helping train more Macau people to cope in areas such as licensing and monitoring. A team from the Macau public service arrived in Australia recently to see how Australia's Centrelink system works. Macau needs to move to electronic government to keep pace with development. The Government hopes to deliver more services online and to streamline of its call centres.

Elsewhere, gaming in Asia is booming.

Last month, Singapore gave the nod to two integrated resorts with a casino each to be built on Sentosa Island and a new reclaimed area known as Marina Bayfront.

Not be outdone, the Philippines Amusement and Gaming Corporation (PAGCOR) plans a US$15-billion project on reclaimed land on Manila Bay to rival Macau. Rafael Francisco, President of PAGCOR, said last year that he would like to speed up the project to catch up with Singapore and Thailand (planning an integrated resort at Khao Lak, near Phuket).

Austrade's Senior Trade Commissioner in Manila, Alan Morrell, says the idea is to make Manila a tourist attraction along the lines of Las Vegas, with a variety of entertainment, such as shows and rides. Apparently, potential investors have begun discussions with PACGOR. But as Austrade sees it, a major hindrance is the expiration of PAGCOR's charter in 2008. Investors would like to be assured that the Government will extend PAGCOR's charter beyond 2008.

Negotiations are on hold until Congress passes a Bill extending PAGCOR's charter, probably for another couple of years. PAGCOR hopes the Government will pass its Bill this year, and is mindful that neighbouring countries like Singapore have already announced their plans for casinos. Sources says that if the Bill is not acted on quickly by Congress, the Master Plan may not proceed as envisaged - especially if potential investors start looking at neighbouring countries as option.

ASIA PULSE
June 13, 2005

Macau casinos eye ways to nab cheats
Facial recognition software could save gaming operators a fortune if a database of photographs can be compiled
Freda Wan in Macau
21 June 2005
South China Morning Post

Casinos in Macau are embracing the latest facial recognition software to keep shady characters off their premises. There is just one problem: while police often maintain lists of "undesirable" gamblers, they do not always have photographs to match.

Macau's three casino companies - Sociedade de Jogos de Macau, the Venetian and Galaxy Resorts - are testing facial recognition technologies, according to Robert Ruggles, business development manager at Vodatel Systems.

In some countries, gambling addicts voluntarily submit pictures of themselves to photo databases, but compiling data on career cheats is not so easy.

"You cannot do the same with criminals," Mr Ruggles said.

Vodatel, listed on the Growth Enterprise Market, is a distributor of identity authentication products from US-based Viisage Technology.

Building a database of undesirable gamblers for Macau's casinos is in the rudimentary stage but visitors to the Nevada Gaming Control Board website can browse a list of people who are excluded from, wanted at or denied access to gaming establishments in the US.

This online blacklist contains photos, names and explanations of why a person is considered "undesirable".

Once Macau authorities obtain a frontal face photo of banned individuals, facial recognition software can draw a map of their facial features, assigning points to the forehead, eyes and chin.

This map is stored in a database to be checked against images of patrons as they enter a casino. Although the system is mostly computerised, human elements inevitably come into play.

An alarm alerts security personnel to possible matches. A search engine provides a list of probable matches for review so that security personnel can decide what action to take.

A casino can choose how close a match it needs - anywhere between a 70 per cent and 95 per cent resemblance - before security personnel are dispatched.

Low-grade facial recognition software and subscription to a database system run by Biometrica, a subsidiary of Viisage, costs $70,000 per year. The database includes data on cheats provided by 170 casinos.

But Macau's casinos are also testing more sophisticated devices that start at about US$25,000, depending on the number of entrances guarded and other customised features.

"The funny thing is, if they can identify one card cheater before he strikes, this would already pay for the system," Mr Ruggles said.

One card sharp cheated millions out of the Sands last May. A Biometrica study of Stratosphere Casino in Las Vegas found that installing the system saved US$536,000 per year for the company.

But it is not just cheats that the casinos hope to keep away. As China's central government attempts to crack down on civil servants gambling in Macau, facial recognition systems could be used to keep party cadres from landing in hot water.

Andrew Hubble is the Hong Kong-based sales manager at Dallmeier Electronics, a German manufacturer that helped design and supply the closed circuit television system at the Sands. Mr Hubble said: "In theory, it is feasible. But it is another issue whether the central government would release a database of its officials."

MACAU – As reported by Bloomberg News: "Harrah's Entertainment Inc., the biggest U.S. casino company, considers Asia an 'untapped market' in the global gaming industry and may enter Macau and other regional cities, said Senior Vice President Richard Mirman.

"The Las Vegas-based company is among 14 groups bidding for a license to develop and run one of Singapore's two proposed casino resorts and may expand as countries from Japan to Thailand consider lifting their bans on casinos.

"Asia's prominence as a gaming market rose after Macau forecast in April that gambling will contribute a bigger share of the economy in two years as casino operators such as Las Vegas Sands Corp. expand their operations.

"…'It's hard not to consider Macau. It's come a long way and we are considering Macau just like we're considering other countries in the region,' Mirman, 39, said in an interview…"

Smith Barney raises PBL (PBL.AU) target to A$15.75 from A$15.62, keeps at Neutral after recent visit to Macau. "Our tour of Macau reinforced our very positive view of that market in terms of likely demand parameters, and the strategic position enjoyed by the Melco-PBL properties," broker says. Adds concerns remain about potential execution and regulatory issues, which are less easy to dismiss. Also makes further cuts to Nine Network earnings estimates. PBL latest at A$15.39. (LMF)

Casinos in Macau embracing facial recognition software, can work if the right databases can be created

South China Morning Post via NewsEdge Corporation

Casinos in Macau are embracing the latest facial recognition software to keep shady characters off their premises. There is just one problem: while police often maintain lists of "undesirable" gamblers, they do not always have photographs to match.

Macau's three casino companies - Sociedade de Jogos de Macau, the Venetian and Galaxy Resorts - are testing facial recognition technologies, according to Robert Ruggles, business development manager at Vodatel Systems.

In some countries, gambling addicts voluntarily submit pictures of themselves to photo databases, but compiling data on career cheats is not so easy.

"You cannot do the same with criminals," Mr Ruggles said.

Vodatel, listed on the Growth Enterprise Market, is a distributor of identity authentication products from US-based Viisage Technology.

Building a database of undesirable gamblers for Macau's casinos is in the rudimentary stage but visitors to the Nevada Gaming Control Board website can browse a list of people who are excluded from, wanted at or denied access to gaming establishments in the US.

This online blacklist contains photos, names and explanations of why a person is considered "undesirable".

Once Macau authorities obtain a frontal face photo of banned individuals, facial recognition software can draw a map of their facial features, assigning points to the forehead, eyes and chin.

This map is stored in a database to be checked against images of patrons as they enter a casino. Although the system is mostly computerised, human elements inevitably come into play.

An alarm alerts security personnel to possible matches. A search engine provides a list of probable matches for review so that security personnel can decide what action to take.

A casino can choose how close a match it needs - anywhere between a 70 per cent and 95 per cent resemblance - before security personnel are dispatched.

Low-grade facial recognition software and subscription to a database system run by Biometrica, a subsidiary of Viisage, costs $70,000 per year. The database includes data on cheats provided by 170 casinos.

But Macau's casinos are also testing more sophisticated devices that start at about US$25,000, depending on the number of entrances guarded and other customised features.

"The funny thing is, if they can identify one card cheater before he strikes, this would already pay for the system," Mr Ruggles said.

One card sharp cheated millions out of the Sands last May. A Biometrica study of Stratosphere Casino in Las Vegas found that installing the system saved US$536,000 per year for the company.

But it is not just cheats that the casinos hope to keep away. As China's central government attempts to crack down on civil servants gambling in Macau, facial recognition systems could be used to keep party cadres from landing in hot water.

Andrew Hubble is the Hong Kong-based sales manager at Dallmeier Electronics, a German manufacturer that helped design and supply the closed circuit television system at the Sands. Mr Hubble said: "In theory, it is feasible. But it is another issue {hellip} whether the central government would release a database of its officials."

Macao's revenue from direct gaming tax reached 6.58 billion patacas (822 million US dollars) in the first five months, an increase of 24.7 percent from the same period of last year.

Statistics released Wednesday by the Finance Service Bureau showed that the direct gaming tax payments made up 77.2 percent of the government's total income between January and May.

Macao's 17 casinos pay 35 percent of their gross revenues as direct tax to the government, according to official figures.

The government's total revenue in the period amounted to 8.52 billion patacas (1.65 billion US dollars), a year-on-year growth of 24.9 percent, the figures showed.

Failing to meet the deadline on any construction project is bad news for the contractors and the client, but when the project in question is a cash machine like a casino, the costs of being late are almost too high to contemplate. Building a casino, in fact, is almost as risky as entering one.

Getting the timing right is a struggle, even for the most experienced of operators. Take Las Vegas Sands, the American gaming firm whose Cotai Strip megaproject in Macau ranks as the biggest construction undertaking in Asia since Hong Kong built its new airport in the 1990s.

Last November, in the fine print of a filing with United States securities regulators, Las Vegas Sands said it expected to spend US$1.8 billion (HK$14 billion) - almost double its previous estimates - on the Venetian Macau, the anchor resort among the more than 20 casino hotels envisioned for the Cotai Strip.

It also said the resort will open only in the first quarter of 2007, breaking the promise it made to the Macau government of a June 2006 completion.

People with experience of projects on this scale say they inevitably produce a tangle of risk-management issues where meteorology, geography and economics overlap with plain, old-fashioned, human unpredictability.

Inflation, of course, can have an unpredictable impact on material and labor costs, but such risks can be transferred by subcontracting, according to Tam Chi-ming, an associate professor of building and construction at the City University of Hong Kong. One risk that can never be hedged is government red tape.

MACAU – As reported by Channel News Asia: "Casino giant Sociedade de Jogos de Macau, or SJM, has shown it is possible for casinos to thrive even in a very saturated marketplace.

"The group's profit and revenue are rising, and it is expanding its stable of 15 casinos in Macau.

"But SJM, which is owned by gaming tycoon Stanley Ho, says that is largely because of unique conditions in Macau.

"And its parent company has had advantage of history and size, having held the gaming monopoly in the enclave for some three decades until the industry was liberalised in 2002.

"Repeat business, according to SJM's administration manager LC Koo, is the key to meet rising competition.

"…He says Macau enjoys special advantages that have helped to keep its gaming industry booming.

"Said Prof Koo, 'Macau is very unique. Macau can be reached by one billion people in two hours' flying time, and can be reached by three billion people in five hours' travelling time. Macau is unique because we have a hinterland, China, backing it, and China has 1.3 billion.'…"

It's the biggest construction project in Asia in a decade, but, the Las Vegas Sands Corporation's new hotel-casino in Macau is running into serious problems. The 'Venetian Macau' in the Chinese enclave is reportedly over-budget and behind schedule. Las Vegas Sands now expects to spend about two-billion dollars. That's almost double its previous estimates. Originally the Sands promised the people of Macau the resort would open in June, 2006. Now they don't expect to open until early 2007. Steve Wynn and MGM-Mirage are also building casinos in Macau.

Macau’s casinos are hoping to implement a new system to keep cheaters and problem gamblers out. The new system, which is designed by Vodatel Systems, using Viisage Technology, would recognize faces that matched photographs of known cheaters. Getting the database of faces poses a unique challenge, though. While problem gamblers and gambling addicts may provide photos voluntarily, it would be much more complicated to get a database of cheaters.

A similar system in the United States includes a database of photographs taken at 170 casinos. The database used in the United includes photographs, profiles, and reasons why they are undesirable gamblers. The Macau system, which would cost about $25,000 for each one of the casinos, depending on the number of entrances guarded, would be an even more technologically advanced system.

The Macau Casinos would lay off some staff to defray the costs of the new system, but the system would require staff to operate. The system works via a computer, which alerts casino security guards, shows them the picture, and allows the casino’s staff to determine whether they want to escort the undesirable player out of the casino.

The three companies operating Macau’s casinos will be testing the system. There is a possibility that China, which has laws against gambling by civil servants, would supply a database for the casinos to ban, but operators of the casinos are skeptical as to whether the Chinese government would want to release pictures.

June 28 2005 - Australasian Investment Review – (AIR)

It is an incontrovertible fact that the Chinese love to gamble. It is clear from surging economic growth that the Chinese are becoming a wealthier population, perhaps not if you are a hapless rural peasant, but certainly if you are connected to the big end of town.

Consider now that the island of Macau – once a Portuguese colony, handed back to China in 1999 – is located within 90 minutes drive for a population of 130 million mainlanders, and within a three hour flight for one billion. It is also one hour away by ferry from Hong Kong.

The Chinese government is in the process of relaxing travel restrictions for mainland Chinese. In 2004, Macau received 16.7 million visitors of whom 60% were from mainland China. Overall, Macau received 40% more visitors in 2004 than in 2003.

It is an incontrovertible fact that equity analysts love a good junket, and a trip to the Las Vegas of the East is probably slightly more appealing than a tour to a bloody big hole in the ground somewhere in the middle of outback Western Australia.

And so it was that analysts from SB Citigroup and from Deutsche Bank bravely volunteered to assess opportunities for Australia’s gambling-related companies at the recent Asian Gaming Expo, held in Macau.

SB Citigroup describes the market potential in Macau as "staggering". Industry estimates forecast the gaming market to increase four-fold from 2004 to 2010, to reach US$20bn in gaming revenues, and for non-gaming revenues to grow from almost zero to between US$20 to US$30bn over the same period.

Presently, hotel rooms are few, and poor, and entertainment outside of gambling is non-existent. In Las Vegas, the average visitor stays 3.4 days and spends US$200. In Macau, the average visitor stays 1.5 days and spends US$500. Imagine if visitors were keen to stay longer! Does China have a rat pack?

Not surprisingly, thousands of new hotel rooms are under development, along with further casino development. Deutsche Bank points out that Publishing & Broadcasting (PBL) is well placed to benefit from the growth in the Macau gaming market via its joint venture with Melco, comprising a high-roller Park Hyatt casino, and a mass-market "City of Dreams" casino resort.

Although electronic gaming machines represented a mere 1.5% of gaming revenue in 2004 (Baccarat is the game of choice at 72%), Deutsche expects the number of machines will increase from 3,000 to 15-20,000 units by 2010, although some put the number as high as 30,000. Thus Aristocrat (ALL) is set to reap the benefits, with rewards also available for Stargames (SGS) and Ainsworth Games Technology (AGI).

Deutsche further suggests the growth of the Macau and Singapore markets could see the liberalization of gaming throughout the region, including Thailand, Taiwan, Japan, Philippines and Korea, taking the number of installed machines from 10,000 to 80,000.

June 30 (Bloomberg) -- Cosco Property Development Ltd. has 1,800 people on the waiting list to buy apartments in a planned condominium in Macau, China's gambling capital. Problem is, the building will only have 56 units.

``They call and say: `Just get me a unit,' without even asking the price,'' said Li Kejing, a manager with Hong Kong- based Cosco Property, a unit of China's largest shipping company.

Gaming companies including Las Vegas-based MGM Mirage are pouring more than $12 billion into building new casinos in the former Portuguese colony, which may overtake the Las Vegas strip this year as the world's biggest gaming center by revenue. Demand for houses for expatriates and Chinese gamblers is likely to lift luxury residential property prices 30 percent in the next 12 months, after they almost doubled last year, agents said.

``If you want to invest in Macau property, do it now,'' said Bich Pham, who helps manage $700 million of stocks at Hong Kong- based TAL Global Asset Management Ltd. ``Macau will be bigger than Vegas.''

Hoteliers and Las Vegas operators including MGM and Steve Wynn's Wynn Resorts Ltd. may spend as much as $20 billion in total in Macau after the 42-year gaming monopoly of billionaire Stanley Ho ended in 2002. The investments spawned plans for roads, apartments and a 29-kilometer (18-mile) bridge to Hong Kong to bring tourists to the city, which generated $5.1 billion in gambling revenue last year.

Venetian Replica

Las Vegas Sands Corp., which owns Sands Macao, plans to open a $1.8 billion replica of the Venetian casino in the first half of 2007, the year MGM Mirage will open its 600-room venture. Wynn's $1 billion venue is slated to open in 2006. The number of gaming tables may quadruple to 4,000 by 2007, said Manuel Joaquim das Neves, director of Macau's gaming control board.

New casinos in Macau, a city of 470,000 people that abuts China's southern province of Guangdong, may draw 30,000 foreign workers in the next few years, said Tim Lei, an investment manager at Midland Realty (Macau). Macau has about 10,000 luxury apartments, and may add 5,000 in the next two years, he said.

``Many Hong Kongers and mainland Chinese are buying these luxury apartments, expecting demand to rise when these foreign professionals arrive,'' said David Faulkner, a Hong Kong-based director of Colliers International Property Consultants Inc., a Boston-based real estate agency.

Prices of Macau apartments that cost HK$3 million ($386,000) or more rose ``between 50 and 100 percent'' in 2004, said Dick Fong, a director at Midland Realty (Macau) Ltd. Property prices in the prime Nape and Zape districts -- where the top-grossing Casino Lisboa and Sands Macau casinos are -- have exceeded HK$3,000 a square foot, from less than HK$2,000 a year ago, said Jim Ng, a Macau-based associate director at Savills Plc, the third-largest U.K.-listed property company.

Property Gamble

``There are many retail speculators behind Macau's booming property prices,'' said TAL Global's Pham, ``Even after the increases, Macau property prices are cheap.'' Top-end property costs about HK$3,000 per square foot in Macau, compared with HK$10,000-HK$15,000 in Hong Kong, he said.

Macau trumped Atlantic City as the world's second-biggest gaming market last year after the opening of Sands Macau pushed gambling revenue 44 percent higher to $5.1 billion.

``There's a lot of interest in Macau, a lot of real estate activity,'' said Midland Realty's Lei.

Sea and Sands

At almost HK$4,000 a square foot, La Oceania, a 90-unit condominium next to the Sands Macao casino, has the city's priciest apartments, said Midland's Fong and Savill's Ng. Cosco Property developed La Oceania.

In Hong Kong, an hour away by high-speed ferry, $386,000 buys a 431 square-foot (40 square-meter) apartment with communal pool a few minutes by car from the business district, according to Web site Gohome.com.hk. In Macau, the same amount buys a 1,200 square-foot seaside unit in Taipa, near the stretch of reclaimed land called Cotai, earmarked for a $12 billion replica of the Las Vegas Strip.

In Las Vegas, the sum buys a 2-bathroom 1,342 square-foot apartment in a low-rise condominium in Clark County, home to the gaming strip, according to Web site lasvegashirisecondos.com.

Some mainland Chinese are buying Macau property to get right of residence, said Savills's Ng. Macau grants residency to skilled workers who invest at least 1 million patacas ($124,876), plus 500,000 patacas in bank deposits.

``The price increases are quite attractive,'' said Liu Shi, 36, who runs a food-flavoring company in China's northern province of Hebei, in a June 10 interview in Macau. ``We hope to get our own property while it's still affordable.''

Some developers and real estate agents say prices in Macau may be rising too fast.

Empty Apartments

Property buyers looking to sell their Macau apartments for a profit in three to five years are getting rental yields of as little as 3.5 percent because more than 30 percent of Macau's luxury apartments are vacant, said Savills's Ng.

``Prices in certain parts of Macau's property market are rising too fast,'' said Deborah Ng, a deputy director at the Monetary Authority of Macau. Ng said the central bank has no immediate plans to try to cool the market.

Macau's property prices bottomed in 2003 after a decade-long slump that began in 1993, said Ng. Apartment prices at Taipa's Ocean Garden Estate fell from HK$3,000 a square foot to HK$1,000 in 2003, returning to HK$3,000 this year, she said.

While luxury property prices have rebounded, average prices in Macau are still 20 percent from their 1993 peak, Ng said.

Banks such as Luso International Banking Ltd., the Macau unit of China's Xiamen International Bank., are betting prices will rise, offering mortgages at 100 percent of the assessed property value.

``Every indicator -- from economic growth to the unemployment rate -- shows that Macau is on the uptrend,'' said Patrick Chau, assistant general manager at Luso International. ``We won't see any problems in the next three to five years.''

Macau's economy grew 8.5 percent in the first quarter after expanding 28 percent to 82.7 billion patacas in 2004.

HONG KONG (AFX) - Macau tycoon Stanley Ho has led a revolt to oust his sister Winnie from the family's multi-billion dollar casino business, the South China Morning Post reported.

Shareholders in the family's STDM business, which owns SJM -- the operator of Ho's 15 casinos -- voted to expel Winnie as a shareholder following a dispute over dividend payments, it said.

'What she has done has made it impossible for us to remain brother and sister,' the paper quoted Stanley Ho as saying.

Although the move has to be approved by a court, company officials said they are confident it will be ratified.

Winnie would be forced to sell up her 6 bln patacas (769 mln usd) worth of shares in the firm, the paper said.

Wynn needs the cash to fund a second phase of construction in Macau.

More than 50 banks have been solicited to participate in the revised US$729 million (HK$5.69 billion) syndicated loan being arranged for Wynn Macau that will pay banks that contribute US$50 million or more a fee of 3.27 percent, bankers familiar with the situation said.

Societe Generale, Deutsche Bank and Bank of America are lead arrangers for the loan, which will almost double the US$397 million seven-year facility that cost Wynn Macau 3.5 percent over the London interbank offered rate when it was signed last September.

The new six-year loan, which will have both United States dollar and Hong Kong dollar parts, will cut Wynn's interest tab to just 3 percent. The company has also arranged a three-year HK$117 million revolving loan that will cost 2.5 percent over the Hong Kong interbank offered rate.

DBS, ICBC Asia and WestLB - which participated in the original loan - are among the lenders considering the deal. To get banks on board quickly, those that sign up before July 27 have been offered an additional 20-basis-point sweetener.

A number of international banks, which declined to be named, are staying away from the deal because they have no previous lending relationship with casino magnate Steve Wynn, largely credited with transforming Las Vegas into a showpiece tourist destination, or because of internal restrictions on lending to gaming houses.

Wynn needs the cash to fund a second phase of construction that will add 150 gaming tables, 500 slot machines, a sports betting area, two restaurants and a theater to the 600 hotel rooms, 200 tables, 350 slot machines and seven restaurants going into operation later this year.

The latest construction will bring Wynn's total investment in Macau to US$1.1 billion, less than half the US$2.75 billion rival Sheldon Adelson, who is building a replica of his successful Venetian hotel and casino in Macau, has earmarked for investment in the former Portuguese colony.

Mainland banks, including Bank of China, Industrial and Commercial Bank (Macau), Banco Delta Asia, Banco Nacional Ultramarino and Banco Commercial de Macau, along with Allied Irish Banks, Korea First Bank, Hong Kong-based Canadian Eastern Finance, Banco Espirito Santo do Oriente, Shinsei Bank and Japan's Aozora Bank were part of the original Wynn loan and have been invited to join the new one.

That deal, the first non-recourse casino financing in Macau, earned participating banks 375 basis points in fees. A non-recourse loan is paid off by cash flows that originate from the project, in this case a casino, that was built using proceeds of the loan.

Bankers expect casinos in Macau to seek as much as US$10 billion in financing over the next 24 to 36 months, with about half in loans and bonds.

Financing Macau's casino construction binge, a far riskier bet than providing money to regional blue chip companies, is attractive to the banks that can do it because of the higher fees they can earn.

Also in the market, K Wah Construction is planning a US$300 million plus bond sale in casino-related finance while Adelson's Venetian Macau will sell a US$260 million floating rate note.

Separately, a joint venture between MGM and Pansy Ho, daughter of Macau casino magnate Stanley Ho, are taking their time to get the best pricing on a US$600 million loan facility that some bankers said may get more attractive pricing than Wynn's because of the partners' strong cash positions and name recognition.

The gross revenue of Macau's casinos rose 19 percent in the first half of the year over the same period of 2004, local media reported Friday.
The Macau Post quoted sources from the gaming industry as saying that the 17 registered casinos recorded a gross revenue of 3.5 billion patacas (US$437 million) in June alone.
Since Macau lifted the monopoly of the gaming industry in 2002, the special administrative region has seen a boom of the business, as the casinos' gross revenue reached the record of 40.18 billion patacas (US$5.02 billion) in 2004,a year-on-year growth of 44 percent.

SINGAPORE –– Casino magnate Stanley Ho is urging China to regulate the growth of Macau’s gambling industry and minimize competition from foreign-owned casinos.

Last year, two Las Vegas-style casinos opened in Macau, operated by Hong Kong-based Galaxy Resort & Casino and Las Vegas Sands Corp. Chairman Sheldon Adelson. Two of Las Vegas’ largest gaming operators, Wynn Resorts Ltd. and MGM Mirage, are already planning grand openings for their complexes in Macau, which was returned to Chinese sovereignty in 1999 after more than four centuries of rule from Portugal.

Since the liberalization of Macau’s gaming industry in 2002 –– ending Ho’s four-decade monopoly –– his company has faced a labor shortage, a doubling of property prices and diluted revenue due to competition.

Industry insiders expect Macau to overtake Las Vegas as the world’s biggest gambling market this year, with casinos ringing up $5 billion.

Far East Consortium International, a Hong Kong-listed hotel operator and property development, is seeking a seven-year loan of up to HK$600 million to fund its hotel and casino development in Macau, bankers familiar with the situation said.

Far East, which runs hotels and apartments under the Dorsett brand, plans to open four hotels in Macau with about 3,000 rooms by the end of 2007.

The InterContinental Hotels Group will manage two of the hotels, one carrying the InterContinental brand and the other branded with the company's mid-market Holiday Inn label. Far East is in talks with Marriott International to manage the third while the fourth will carry Far East's Dorsett label.

The company will lease 140,000 square feet of space to Las Vegas Sands, owner of Sands Macau, the territory's first Vegas-style casino, for showrooms and a casino.

A shopping mall, with one million sqft of retail space, will make it Macau's largest, with a multiplex cinema, ice skating rink and rides also planned. The total cost of the project is HK$2.8 billion.

The complex will be located on Macau's ``Cotai Strip,'' a stretch of reclaimed land between Taipa and Coloane islands, hyped to become the Las Vegas of the East.

The original plan called for a total of about 20 casino resorts to be opened in stages with the first seven, each with 1,500 rooms, to be completed by 2007.

Wynn Macau, Macau Sands and MGM Paradise are all at work on financing casino projects with international banks eager to cash in on the territory's construction boom.

But with such big names seeking financing, smaller organizations, such as Far East Consortium, are having a relatively harder time attracting bankers, who prefer to stick with better-known names that have a good credit track record in the gaming sector.

``We're only looking at US sponsors,'' a banker who declined to be identified said.

Las Vegas magnate Steve Wynn, behind Wynn Macau, is credited with revitalizing Las Vegas and turning it into a international tourist attraction. Sheldon Adelson, backing Sands Macau, also helped raise the city's status on the international convention circuit in addition to running casinos.

Far Eastern owns hotels and apartments in Hong Kong and Malaysia and is at work on a hotel in Japan.

The Ho family of Hong Kong, owners of 15 Macao Casinos, have deepened their rift. Stanley Ho, 83, has disowned his 82-year-old sister, Winnie. Last week, Mr. Ho led a shareholder vote to oust Ms. Ho as a shareholder in STDM, resulting from a debate regarding company dividends. If the decision is approved by the Macao courts, Ms. Ho will be forced to sell off her shares, valued at $769 million.

Stanley Ho was born in Hong Kong to the Ho Tung family, and moved to Macau in the 1940’s. In the 1960’s, he teamed up with Henry Fok and other partners, at which time the Macau government approved a deal to allow the company to hold a 40-year monopoly on Macau’s casinos. While the deal expired in 2002, STDM currently controls 15 of the 17 casinos in Macau and has stakes in almost every major industry in the Chinese enclave, including hotels, ports, airports, television networks, and bridges. Overall the company accounted for 42% of Macau’s economy in 2004.

In 2001, Winnie Ho was sued for a bounced check of $1.5 million, which her son, Michael Mak said was part of a plot to gain Ms. Ho’s shares of the company, as evidenced by repeated efforts to give Stanley Ho’ daughter and wives a more active role in the casino company. In response to her recent ousting from the company, Ms. Ho said she would sue her brother for taking her position and appointing his third and fourth wives as the new directors. Ms. Ho said that she had posted the full capital for the company, using a gift from her cousin and lover Eric Hotung. She believes her case is very strong because she has not received any dividends from the casinos or other business ventures since 2001.

HONG KONG – As reported by the Singapore Business Times: "Stanley Ho, the Asian gambling tycoon, has disowned his younger sister as a four-year rift in one of Hong Kong's most prominent families deepens, reports the Financial Times.

"The siblings, 83 and 82, have been locked in a bitter power struggle since 2001 over 3 billion patacas (S$635 million) of dividend payments and shareholdings in STDM, Mr Ho's gambling empire in Macau, the former Portuguese colony.

"The fight, punctuated with lawsuits and threats, escalated last week when STDM's equity investors ousted Ms Winnie Ho as a shareholder because of her 'repeated attempts to disturb the company's operation'. The decision was passed unanimously by major shareholders, although it still needs approval by Macau's courts.

"…STDM controls 15 of Macau's 17 casinos and has stakes in the enclave's airport, port, airline, television network, bridges, the Macau Jockey Club, numerous hotels and many more operations. SJM, the gaming arm, alone accounted for 42 per cent of Macau's US$10 billion economy last year.

"…She also vowed to take her brother to court last week after denouncing STDM's decision to expel her from the company and appoint Mr Ho's third and fourth wives as directors…"

By Le-Min Lim and Bernard Lo
BLOOMBERG NEWS
Owner Lui Che-woo's plan to turn Galaxy Casino SA into Hong Kong's first listed casino operator may give the company access to funds as it adds slot machines and roulette tables in Macau, Galaxy's chief executive said.

Galaxy is "confident" shareholders at Hong Kong-listed K. Wah Construction Materials Ltd. will vote July 19 to approve an HK$18.4 billion ($2.37 billion) plan to buy the casino operator, Anthony Carter said in an interview broadcast Tuesday.

K. Wah Construction's purchase "will give Galaxy a public platform, more visibility and more access to the capital market," said Carter. "So, it's very important for us."

Shares in K. Wah Construction have fallen 44 percent since the acquisition plan was announced April 19, compared with the Hang Seng Index's 5 percent gain. To fund the purchase, K. Wah Construction sold 146 million shares at a discount to raise HK$1.2 billion. The company also plans to borrow and sell bonds for the takeover. The Lui family controls K. Wah Construction.

Galaxy is one of three companies to clinch a gaming license in Macau after Stanley Ho's family lost its 42-year monopoly in 2002. Galaxy is joining with Las Vegas Sands Corp. to expand in the former Portuguese colony as an influx of Chinese tourists triggered a surge in gambling revenue to $5.1 billion last year.

Gaming companies including MGM Mirage are pouring more than $12 billion into building new casinos in Macau, which may overtake the Las Vegas strip this year as the world's biggest gaming center by revenue, according to Deutsche Bank AG.

Galaxy and Las Vegas Sands have to invest a combined 8.8 billion patacas ($1.1 billion) in Macau by 2009 or risk losing their gambling license. Galaxy expects to spend 5.9 billion patacas in Macau's city center to build a premium resort hotel and casino complex called Galaxy StarWorld Hotel, and a club casino at the Rio Hotel next year; a casino on the Cotai Strip, a reclaimed piece of land, and a "mega resort complex" called Galaxy Cotai Mega Resort in 2008, according to a document sent to K. Wah shareholders last week. Galaxy's only gaming property in Macau is the Waldo Casino, which opened on July 4 last year.

Las Vegas Sands, which opened the $265 million Sands Macao casino last year, will "be responsible" for investing 4.4 billion patacas, Galaxy said in the document. Sands said it plans to build a $1.8 billion replica of its Venetian casino in Las Vegas on Macau's Cotai strip in the first half of 2007.

Galaxy, which now counts on wealthy, or VIP, gamblers for all its revenue, expects to tap the mass market and slot-machine market when it opens the new casinos starting next year, Carter said. Macau's VIP market, made up of about 4,000 mainly mainland Chinese gamblers who bet at least $1 million a visit, generated 70 percent of the city's gambling revenue last year.

"As the Macau market changes, as the middle-class develops, the mix is certainly going to change," said Carter. "The VIP market will become proportionately less important. We will be there to meet" the change.

Galaxy's share of Macau's gambling market fell to 9.3 percent in the first two months of 2005, from 14 percent in 2004, the Standard reported on May 31, citing Commerzbank, the financial adviser to independent shareholders and K. Wah Construction's directors.

Stanley Ho's Melco International Development Ltd. also plans to tap different segments of Macau's gambling market by opening a six-star hotel resort that caters to high-rollers and an underwater casino-hotel resort on the Cotai Strip for mass- market gamblers. Melco already operates a chain of slot machine outlets called the Mocha Slots for budget gamblers.

Macau's lucrative VIP market has been linked to triads and money-laundering. Some Macau casinos catering to VIPs are used by criminal gangs to launder money, the U.S. State Department said in a March 1 report to Congress.

Macau's government vowed to clean up the city's seedy image by tightening laws that curb money laundering, the International Herald Tribune reported on May 26.

Carter blamed the drop in market share on "seasonal adjustment" and the waning of Waldo Casino's "curiosity value." Galaxy expects revenue to "pick up in the second half," he said, without giving specifics.

July 9-10, 2005

MACAU -- This small Asian enclave is on the verge of supplanting mighty Las Vegas as the top gambling market in the world.

The entire Macau peninsula, two islands and a reclaimed river delta, covers about 16.9 square miles compared with Las Vegas' 84.3 square miles. But pound for pound, gamblers in Macau are far more aggressive than those visiting Southern Nevada.

When Macau was turned over to the Chinese government in 1999 -- the same year Hong Kong made a similar but more newsworthy transition -- one of the first moves by the new administration was to open the gaming market to competitors, ending a 40-year monopoly.

The resulting injection of competition has made the market explode, with analysts expecting gaming revenue to surpass Las Vegas levels this year or next.

The Macau government reported gaming revenue of $5 billion in 2004, about $3.5 billion ahead of 2003's total and slightly ahead of the $4.9 billion generated last year on the Las Vegas Strip.

With 15 casinos operating in Macau with about 1,000 table games, the per-table win in Macau is nearly 10 times the per-table win in Las Vegas. Experts say Macau's gaming market could grow from $9 billion to $12 billion in the next five years as the Chinese tourism market expands and more resorts are built.

Now, a familiar shape -- familiar, at least, to Las Vegas residents -- is joining the skyline of this island resort city that shares a fascinating blend of Chinese and Portuguese cultures.

Wynn Macau, the 600-room hotel due to open in the third quarter of next year, will look a lot like its American big brother, Wynn Las Vegas, which opened on the Strip in April.

To people familiar with the Las Vegas version, Wynn Macau won't hold many surprises. But to Macanese who are watching the building take shape, the resort will be a dramatic departure from anything in the market today.

But that's what makes Macau the world's most intriguing gambling center and why most experts expect it to surpass Las Vegas as the world's dominant casino market.

"We've heard Macau referred to as the Las Vegas of Asia," said Grant Bowie, who as president and general manager of Wynn Macau is Steve Wynn's top man in Asia. "But there's only one Las Vegas in this world. Our objective here is not to be seduced by another market as the way (Macau) is going to evolve."

Las Vegas companies are clearly leading the change that is taking place in Macau, which is on the tip of China's southern seacoast and is a one-hour boat ride from Hong Kong.

There are varying theories as to how the evolution of Macau is going to occur. But most agree that the transformation will involve turning it from what is predominantly a day-trip market to a resort destination where tourists stay longer. Operators also hope to bump up hotel occupancy rates.

L.C. Koo, head of the performance improvement department for Sociedade de Jogos de Macau, the dominant casino operator in Macau owned by Stanley Ho, said in 2004 that visitors from China stayed an average of 1.1 days at the company's 15 casino properties and visitors from Hong Kong stayed a day.

Since 1999, the occupancy rate of Macau's 9,600 hotel rooms has gradually increased to 75 percent from about 50 percent.

William Weidner, president and chief operating officer of Las Vegas Sands Inc., believes the demographics of the population that lives a few hours of Macau will lead the city to surpass Las Vegas become the dominant gambling market in the world.

Experts say there are more than 100 million people within a three-hour drive of Macau and more than 1 billion people within a three-hour flight. As the Chinese economy expands and travel and visa policies are relaxed, more and more people are expected to make the trek to Macau.

"The opportunity is just terrific," Weidner said at a recent gaming conference in Singapore. "The developments planned will change Macau forever."

The Sands Macau has been open for more than a year, and executives are happy with the early results. But the company's big push in Macau will occur with its development of the Cotai strip, on what once was a river delta on the island of Taipa, connected by bridge to Macau.

"Since the opening of China, things have changed dramatically," Weidner said. "Given the growth of the Chinese economy overall, there is just a huge opportunity for Macau to develop into something much, much greater than Las Vegas."

Gaming analysts say the Las Vegas companies are well positioned in Macau and that existing casinos will have a hard time keeping up with the Americans.

"Outside of Sands Macau, the existing properties are nowhere near the quality of the next-generation projects coming on line," said Marc Falcone, a gaming analyst with Deutsche Bank, after a June trip to Macau. "As such, we do not anticipate that the older supply will be able to compete, and that attrition from these facilities will offset some of the new supply."

But Bowie and others think the Macau market expansion will play out much the way that it has in the United States with the proliferation of tribal casinos: The entire market will grow as a result of the increased competition.

"We're going to be a player in the high-roller market and we're going to be a player in the premium mass market," Bowie said. "We'll have a bigger piece of the pie, but we also expect the pie to grow."

Ho's empire

If the pie grows as Bowie suspects and the American interests get rich as a result, few will be shedding any tears for Ho and his Macanese empire.

Ho owns many of the concessions, including Asia's largest hydrofoil fleet, and a helicopter service that ferries passengers between Hong Kong and Macau.

While tourists from China have access to Macau by land from the mainland side, visitors from Hong Kong must either take a boat or fly to Macau.

Getting to the harbor at Hong Kong island is easy with the terminal at the end of one of the easy-to-use, high-tech subway lines.

It's fairly simple to book a seat on the Jetfoil boats, which leave every 15 minutes and cost $141 in Hong Kong currency -- about $18 in U.S. dollars.

The voyage on the South China Sea skirts several islands and offers passengers views of Hong Kong's impressive skyscraper-filled skyline.

Boats seat about 600 passengers in two classes with passengers in the front of the boat getting a meal. The seats are comfortable and a comedy reel runs on video during the voyage. The air-conditioned cabin offers relief from the sticky humidity and 90-degree temperatures or frequent rain storms.

Tourists arriving in Macau by ferry see the 1.1-million-square-foot Sands Macau and its 71-foot sign as soon as they hit the harbor. A themed fisherman's wharf retail attraction nearby is in the final stages of construction.

The ferry station is a study in organized chaos with passengers getting off the boats scrambling to Customs and Immigration service lines. People traveling between the special administrative regions of Hong Kong and Macau are required to carry passports and go through the same entry process as those going to another country.

Once inside the main terminal, there are taxi lines and buses available. Few taxi drivers understand English. Knowing Spanish offers a little help since it is relatively close to Macau's secondary language, Portuguese.

But the easiest way to get around is to go to the information desk and find a bilingual employee to write a destination in Chinese characters.

Wynn Macau's corporate offices are on the ninth floor of the Hotline Center office building near a major hotel and the cab ride was a few dollars. Although the pacata is the standard currency of Macau, the local merchants accept Hong Kong dollars.

Ho's casino empire is spread out in hotels throughout the city and on the nearby islands of Taipa and Coloane. His company, known throughout the region as SJM, controls more than 80 percent of Macau's five-star hotel rooms -- a standard that may rank closer to three stars in the United States.

Among the SJM casinos are the Lisboa, where a doorman dressed like a conquistador meets hotel arrivals, and the Casino New Century-Greek Mythology on Taipa, which seems to have torn a page out of the Caesars Palace playbook with characters dressed as Greek gods and goddesses being photographed with guests, just like the versions of Caesar and Cleopatra are in Las Vegas.

There are similarities and differences between the SJM casinos and a traditional Las Vegas casino floor. Casino operators take security seriously -- players have to pass through a metal detector like those at airports and courthouses to get to the casino action.

The most striking difference between an American casino floor and an SJM property is the dominance of table games to slot machines. Reports about the two-fisted style of gambling at the tables are true. On a Monday afternoon, players were standing about three deep wagering at the Lisboa's tables. Baccarat is the game of choice and chain-smoking, serious gamblers play undistracted in a noisy party atmosphere.

Private gambling salons ring the main casino and provocatively dressed unaccompanied women are all around -- a lot more visible than their Las Vegas counterparts.

At the Greek Mythology, the gaming extends upward several levels with balconies overlooking an open theater with live entertainment.

Sands Macau

The atmosphere at the Sands Macau is as electric as it is at the Lisboa with table games dominating the floor.

The six-acre parcel is 1,200 feet long and 300 feet wide and built on piers over a flood plain.

With a 50-foot ceiling, the cavernous building became Macau's first stadium-style casino. A massive chandelier -- the largest in the world -- dominates the room.

The property has Macau's first Las Vegas-style buffet, a total of 1,600 restaurant seats and a porte cochere with four lanes.

Eighteen private gambling salons attract Chinese high rollers as the company markets the invitation-only Paiza Club concept it is using at the Venetian to draw premium players to the resort.

While a four-lane porte cochere wouldn't attract much attention in Las Vegas, it's a major breakthrough in Macau where long taxi lines are the norm. A one-minute wait for a cab makes it popular with players and the Sands Macau also has a separate bus entrance that makes the property popular with large groups.

The casino is designed so that a future tower expansion for hotel rooms is possible.

In addition to baccarat, players seem to be drawn to "Big Small," a dice game that plays similarly to roulette. Three die are rolled beneath a bell-shaped shield and players wager on a board on the outcome of each roll.

The property has 370 table games, the most in the Macau market, and about 300 slot machines.

Weidner said Las Vegas Sands decided to leap quickly into the mass day-trip market with a casino "as close to the ferry terminal as we could build it." The strategy is certainly paying off in terms of visibility.

Wynn Macau

Closer to the central Macau business district are three construction projects in various stages of completion.

The Wynn Macau, Galaxy Casino S.A.'s StarWorld and the MGM Grand Macau are all being built on one of the last vacant parcels in the central business district, next door to the Lisboa.

The Wynn's American-style construction methods have enabled workers to surpass Galaxy's project, which had an earlier groundbreaking but is using bamboo scaffolding for its work crews.

Phase I of Wynn Macau -- which will have 600 rooms, 100,000 square feet of gaming housing 200 table games and 350 slot machines, seven restaurants and 28,000 square feet of retail space, a spa and entertainment facilities -- is nearly ready to add its trademark crown that holds Wynn's signature.

Judging from models at the Wynn Macau corporate headquarters, the building will have some subtle differences from the Las Vegas resort -- the curve into the crown bends the opposite direction.

With the opening of the property still a year away, plans for Phase II of the Wynn Macau already have begun to take shape. The expansion will add another 85,000 square feet of casino space, enough for 150 more table games and 500 more slots, a sports book, two restaurants, a theater and a water attraction at the front of the property.

Construction is expected to start on the expansion this quarter and it is expected to open in the first half of 2007. That will bring Wynn's Macau investment to just over $1 billion.

MGM Grand Macau

Wynn Macau's next-door neighbor will be one of its Las Vegas rivals, MGM Mirage, which is developing the 600-room MGM Grand Macau resort.

MGM Mirage is engaged in a 50-50 partnership with Stanley Ho's daughter, Pansy Ho Chiu-King, manager of MGM Grand Paradise Ltd.

The partners broke ground last month on a 28-story wave-shaped tower. Company officials envision suites and villas on par with the Mansion at the MGM Grand. A 222,000-square-foot split-level casino floor will have 300 table games and 1,000 slot machines.

The property also will include a 1,500-seat theater, a 5,500-square-foot nightclub, and 13,500 square feet of meeting and convention space which will include an 11,000-square-foot ballroom.

The $975 million property will have nine restaurants with varying cuisines, including a restaurant on the roof with views of the city and the harbor.

A 25,000-square-foot spa rounds out the amenities for the resort.

Like Wynn Macau, the MGM Grand Macau already has announced plans for an expansion with the ability to add 72,000 square feet to the casino floor's second level. The additional space would give the property the capacity to expand to 400 table games and 2,000 slot machines, which would make it the largest casino floor in the city.

Will tourists gravitate to slots when the culture suggests that most players prefer table games?

John-Martin Meyer, managing officer of Revive Gaming, MGM Mirage's slot technology division, and a former slot director at Las Vegas' Excalibur property, believes slot machines can still be a viable market in Macau and that they just haven't been marketed properly there.

"It's an understudied, understated misconception" that slots are destined to be the weak sister of the Macau market, Meyer said.

He believes that with proper positioning and better presentations, slot machines can be as lucrative as the table games in Macau.

The Cotai Strip

Possibly the most intriguing addition to the Macau market is the Cotai Strip, located on reclaimed land between the islands of Taipa and Coloane, a short hop over a bridge from Macau's central business district.

That's where Las Vegas Sands is building the Venetian Macau, with 3,000 suites, 1.2 million square feet of meeting and convention space, 850,000 square feet of shopping space, a 2,000-seat showroom, a 15,000-seat arena for world-class entertainment, 22 restaurants, a 66,000-square-foot spa and wellness center and an outdoor recreation area with waterfalls, wave pools and a lazy river.

The Venetian Macau, currently under construction, will be the $1.8 billion anchor for seven resort hotels offering 12,500 guest rooms, 1.8 million square feet of meeting and convention space, 1.6 million square feet of retail, 550,000 square feet of casino space and a total of 25,000 seats in venues for live entertainment.

"If you take a piece of the (Las Vegas) Strip of what is now the Wynn Resort and what is now the Bellagio Resort -- that piece in Las Vegas -- move it over to Macau, that's about the volume of space and distance generally and about the number of rooms that are being developed there," Weidner said.

The first phase of the Cotai Strip is due to open in early 2007. Joining the Venetian clone on the Cotai will be properties by the Dorsett Hotel Group, Four Seasons Hotels and Resorts, Hilton Hotels (which include the Hilton, Conrad and Scandic brands), InterContinental Hotels Group (which offers the InterContinental and Holiday Inn brands), Marriott International (which has the Marriott and Renaissance brands), Regal Hotels and Starwood Hotel and Resorts Worldwide (which offers the Sheraton and W brands).

Although there are a number of buildings that will look much like properties in Las Vegas -- the Venetian Macau and the Wynn Macau will look just like their counterparts and the Macau Tower has an eerie resemblance to the Stratosphere Tower -- Wynn's Bowie insists that Macau is its own market and duplicating the Las Vegas experience down to the last brick would be a mistake.

He also cautioned that the transition of Macau to a world-class resort destination won't happen overnight.

"This is going to take a lot of commitment by developers," Bowie said. "It's not a quick transition. It's more like 'War and Peace.' "

By Sheldon Adelson

'I had a dream one night,' casino mogul Sheldon Adelson told hundreds of analysts, journalists and investors gathered in Macau in March. "All of a sudden it came to me. There's room and demand to create Asia's Las Vegas.''

Macau, he said, was to become "the major conference and exhibition center for all of Asia.''

As waiters dressed in the costumes of medieval Venice sauntered by with champagne and canapes, the head man of Las Vegas Sands waited for the lights to dim before yanking away a shroud covering a three-meter-wide scale model of seven casino resorts, complete with flashing lights.

A dozen favored guests, presented as partners, sat on the stage with the septuagenarian billionaire who had cast himself in the role of creator. Two days before the speech, Adelson applied to United States regulators to trademark the phrases, "Asia's Las Vegas'' and "Cotai Strip,'' his company's name for the area shown on the model.

In just three years, Adelson said, tens of millions of mainland Chinese would pour over the border for concerts, trade shows and, of course, gambling, on the Cotai Strip.

Adelson and Las Vegas Sands spent three years negotiating with government officials, hoteliers and investors to reach this day but months later, Adelson's grand dream is fading.

Dozens of cranes are in motion setting the foundations for the Venetian Macau resort that is to anchor the Cotai Strip but there is little to show for the other six resorts on Adelson's big model or the 13-18 others intended for subsequent phases.

Adelson's dream team of investors who shared the stage with him aren't showing up and underestimated rivals are scoring surprise victories.

No one is counting Adelson out, of course. From humble beginnings he has built 50 companies over six decades and is now worth close to US$12 billion (HK$93.6 billion). He hinted recently that his company may invest nearly US$1 billion more than previously estimated in the Cotai Strip.

But his foes are well endowed too and bigger plans than his have come to naught on the shifting sands of Cotai since Macau's former Portuguese administrators started reclaiming land between Taipa and Coloane islands, which together give Cotai its name. Adelson's plan echoes a scheme advanced by Stanley Ho a decade ago that failed to win government support.

"Macau is very small,'' says Antonio Jose Castanheira Lourenco, director of the Office of Infrastructure Development. "[Cotai] is the area where Macau can have big projects.''

Despite rapid reclamation, Macau is still the world's most densely populated place, with nearly three times as many people per square kilometer as Hong Kong. Cotai's 6.2 square kilometers will be the biggest addition yet, adding more than 25 percent to Macau's land mass - the equivalent of another Taipa Island.

Lourenco has seen many Cotai visions since he arrived from Portugal in the early 1990s to take charge of a newly established agency overseeing the zone's development.

Cotai was to be one of a number of bold projects left as a legacy at the close of three and a half centuries of Portuguese rule. Just over 10 years ago, the government published a master plan, envisaging a self-contained "new city,'' linked to the mainland by a bridge to Zhuhai and a train line to Guangzhou, where up to 450,000 inhabitants would live, work and play.

But it was not to be. As the master plan was published, Macau's property market was entering a free fall that would last most of a decade. Momentum evaporated.

Development proceeded on a small industrial park and the Lotus Bridge from Zhuhai and its attached immigration post. The government also widened the causeway that connects Coloane to Taipa through Cotai. But the train never came.

With Cotai in limbo, Stanley Ho and his allies proposed a HK$23.4 billion China Macau World Trade Center to include 10 hotels, a huge exhibition center and a theme park. Entrepreneur David Chow backed a HK$6 billion plan called Mega City for a 2,000-room hotel, a golf course and combination indoor ski slope/artificial beach.

Developer Victor Armando Fung proposed a HK$1.8 billion Convention and Exhibition Center with two hotels and conference halls. A fourth HK$1.5 billion proposal envisaged a marina, two hotels, a driving range and apartments.

Ho and Chow's grand plans went nowhere, but the two more modest proposals received official endorsement. The convention center still failed to take off.

The real estate bust wasn't the only factor. Official attention shifted to what was then open gang warfare on the streets and the approaching handover to Chinese rule. Tourism was in a deep slump.

Just before Macau's return to China in 1999 Cotai got its first hotel - the Pousada Marina Infante, complete with a Ho-run casino. An attached marina highlighted Cotai's new direction: sports.

In 1997 Macau won the right to host the Fourth East Asian Games, to begin in September. This week, the government opened the East Asian Games Dome, the biggest project in its HK$2.7 billion Games construction program, in southeastern Cotai.

Next door, work is nearing completion on the HK$232 million Macau International Shooting Range as well as tennis and bowling centers.

Southwest Cotai is also home to a HK$23.1 million go-kart track built with government support, and a private golf course opening this year. Other sports fields are going up around the Macau University of Science and Technology, which opened in northeast Cotai in 2001.

With private development otherwise stagnant, Hong Kong-listed eSun Holdings offered four years ago to open a HK$300 million television production center in Cotai called East Asia Satellite Television City by 2003.

ESun dithered on development, missing its first target date, while meantime Macau ended Stanley Ho's gambling monopoly and solicited bids for new casinos. The government in early 2002 selected Galaxy Casino and Wynn Resorts to share the market with Ho's Sociedade de Jogos de Macau. The government bound each to invest billions of dollars in new resorts.

Galaxy Casino had the most to deliver. Originally a group of Hong Kong and Macau businessmen led by Lui Che-woo of the K Wah Group, Galaxy won the government's favor with its last-minute pairing with Adelson, who appealed to officials because of his record at building Las Vegas into a world-leading trade show center.

Only a few years before going to Macau, Adelson opened his first casino hotel, the Venetian, in which gondoliers serenade passengers on an indoor canal.

Galaxy promised to invest HK$8.8 billion to build a 3,000-room Venetian and other properties in Macau. Cotai quickly emerged as the logical site, partly because of an official desire to steer casino development away from residential areas.

For Adelson, the swampy plain was the promised land. At the March event, he said that after Chief Executive Edmund Ho discussed Cotai with him, ``it became clear this was an opportunity that had not been capitalized upon by anybody else.''

But just one resort might not be a big lure so Adelson turned his thoughts to assembling a cluster of six or seven.

``We need more critical mass,'' he told Business Week in 2002. Competitors would be frozen out, he told the magazine, ``because the land, all the [plots of land] will be taken.''

He said he would spend US$500 million-600 million to open the Venetian by 2005.

The formula Adelson wants to transplant from the Venetian Las Vegas to Macau is to host a full calendar of trade shows to pack hotel rooms with expense-account travelers during the week, while using stage shows and other lures to tap the easier weekend leisure market.

Both groups could be counted on to gamble their fair share at the tables.

His first big stumbling block came when talks with the rest of the Galaxy group collapsed in late 2002. To keep him in the game, the government endorsed an arrangement whereby Las Vegas Sands became a subcon-cessionaire under Galaxy, with separate operations and obligations. Now the two groups would split the Cotai site, suddenly giving Adelson competition next door.

He soldiered ahead, finding a ready audience among international hotel groups willing to manage resorts on Cotai - as long as someone else paid for construction. The Venetian broke ground the following month. The opening was pushed back to 2006, the latest allowed under the subconcession agreement.

As the year went on, the budget skyrocketed to US$1.8 billion and the opening date slipped to the first quarter of 2007. Last month, a company filing with US regulators put the date back another quarter.

The government could strip the company of the right to operate in Macau if it misses the deadline.

Company officials say they expect to get an extension but have yet to receive one and Galaxy is contractually entitled to a say on whether it does.

Adelson showed no sign of worry in March, casting the event as a celebration of success at sealing deals with hoteliers and investors for the six casino resorts that would join the Venetian Macau in Cotai.

It sounded grand. William Weidner, Adelson's top lieutenant, told inter-viewers that the company would landscape the Strip with a mountain, a waterfall and decorative features related to the Eight Immortals of Chinese mythology.

The Venetian Macau, he said, would have three canals to the Venetian Las Vegas' one.

These gondoliers may yet sing, but the government seems increasingly keen to cancel the blank check Adelson thought Chief Executive Ho gave him for Cotai.

Lourenco says two sites next to that of the Venetian Macau are now at Las Vegas Sands' disposal but the fate of four others must be negotiated between interested investors and the government.

Las Vegas Sands has made inconsistent statements on whether it has received official approval for its master plan.

Adelson's difficulty translating the good cheer displayed in March into definitive agreements with investors is eroding his position with officials in the face of demands from other casino operators for space to build. His competitors have bought his sales pitch more than his would-be partners.

Naturally, Stanley Ho struck the biggest blow. Adelson said in March that Ho wouldn't be in Cotai. ``If I were him, I'd concentrate on protecting [existing] casinos,'' he said.

But in May, Ho's son Lawrence unveiled a HK$8 billion plan for a resort featuring an underwater casino lapping over a plot on which Las Vegas Sands previously penciled in one of its resorts. To fill out the site, the government allocated to the Hos a plot that had been reserved for the University of Science and Technology.

John Alexander, chief executive and managing director of Australian partner Publishing and Broadcasting Ltd, said: ``Clearly, Cotai is the largest and almost the last major open space in Macau.''

The elder Ho said in June he and his son would announce a second Cotai project this month.

Though Adelson's former Galaxy partners have yet to break ground on their own Cotai resort, they are further along in grabbing land.

Galaxy bought the aborted Convention and Exhibition Center project site next door and took a 10 percent stake in the tentatively named Grand Waldo Hotel project across the street.

Construction on this hotel is well along and it will open with a Galaxy-run casino early next year.

One plan under consideration for the Galaxy Cotai Mega Resort would create the world's largest casino and largest hotel, said Ken Gotfried, senior vice-president for gaming operations.

ESun, after announcing late last year it had changed to a residential-focused development plan for its site, said in late May it would instead build three hotels and at least one casino. Chief executive Mark Lee estimated building costs at HK$3.7 billion.

According to a Cotai area plan shown by Lourenco, about a quarter of the land remains uncommitted. His plan shows a third row of hotels along the lines of Cotai Strip Phase II, but he is noncommittal about whether any developers have been designated.

Further east are four unpledged plots intended for tourism development. Next to the East Asian Games Dome a large site has been offered to a group planning a theme park and a hotel. South of the dome is a swathe of land still awaiting a plan.

Odd as it may sound, nature is not being ignored, Lourenco says. An area between the Galaxy and eSun projects, along with the western edge of Cotai, is designated for the protection of mangroves and the black-faced spoonbill, an endangered bird species that uses Cotai as a seasonal roost.

Adelson's difficulty in getting in-vestors to nest is related to his dream: Building a cluster of big resorts as mighty as the Las Vegas Strip but with the casino and conference halls under his sole control.

Some investors are reluctant to get on board without a share of casino revenue.

Stanley Ho's company gives hotel landlords a base cut of 40 percent of gross receipts; Galaxy pays out even more.

The massive growth in hotel capacity concerns investors who would depend solely on hotel revenue for their returns. Occupancy rates have been dropping this year with the opening of several mid-sized properties.

Adelson's first local venture, the Sands Macau, is a blockbuster success - but purely as a casino with just 51 rooms provided complimentary to high rollers.

It proves there is unmet demand for quality gaming by low-stakes players, but it's unclear whether such players want a Macau hotel room to sleep in.

Macau's proven market, analysts say, is hard-core gamblers who either visit on day trips or stay up all night in casinos or saunas.

Building casinos for them is a low-cost, low-risk strategy compared with Adelson's dream.

Marc Falcone, an analyst with Deutsche Bank, said: ``It's too early to tell if Macau [can] become a destination market.''

Las Vegas Sands quietly disclosed last month that it would take over the funding of the US$200 million Four Seasons hotel, after Singapore's Hotel Properties dropped out, and that two other US$400 million Strip resorts could get its direct support.

The only investors currently committed to the Cotai Strip are Far East Consortium and Regal Hotels International Holdings.

Neither of these Hong Kong-based companies has signed a final agreement with Las Vegas Sands but are moving forward with preparations to build and run hotels primarily targeted at the same mid-market travelers both already serve with hotels in Hong Kong.

Far East officials say they are willing to forgo a share of casino revenue because institutional shareholders might then have to sell their shares. Under gaming regulations in Nevada, where Las Vegas Sands is based, revenue-sharing partners must be individually scrutinized and approved.

That could have been a problem for Far East, whose chairman, among others, has previously faced criminal charges.

Adelson's Cotai rivals will rely partly on alternative financing: Pre-selling apartments in buildings attached to their resorts at a time of soaring property prices. Macau wanted to keep casinos out of residential neigh-borhoods but officials seem willing to allow neighborhoods to go up around new casinos.

At any rate, Cotai may not be the last frontier after all. Reclamation has yet to generate controversy in Macau. MGM Mirage chairman Terry Lanni told The Standard he expects a big new reclamation zone on another side of Taipa.

``Macau has only scratched the surface,'' he said. `` Macau can grow dramatically.''

HONG KONG - Emperor Entertainment Hotel Ltd. reported net income of roughly HK$17.6 million, or $2.3 million, for the year ended March 31, mostly from its casino cruise operation but said it expects a hotel it will open by year�s end in Macau will be a key driver.

Emperor Entertainment Hotel, the gaming business subsidiary of Emperor International Holdings Ltd., said it garnered much of its revenue from the leasing a casino area of its cruise ship, Golden Princess.

The company�s hotel project will include gaming and retail operations. It is also developing a shopping arcade in Shanghai. �We are confident that these will become our major growth drivers,� said Vanessa Fan, the group�s executive director.

In January, the group acquired a 45 percent interest in a development project of a hotel with casino operations in Macau. The total investment cost of the project is expected to be HK$1.5 billion, or $200 million, and the group said it expects to contribute about HK$450 million, or $58 million.

Set in Macau's city centre, the hotel will feature about 300 rooms, retail and gaming facilities, including gaming tables, VIP rooms and slot machines. Gaming operations are set to begin in September while the hotel will have its grand opening in December.

�Our hotel will become one of the early players in Macau's gaming market as it is two years ahead of other major gaming projects under development in the area,� Fan said. The operation is targeting medium to high rollers, she said.

The Macao police have busted an underground casino operated at a downtown hotel, local media reported on Thursday.

The Macao Post quoted police sources as saying that four suspects involved in the illegal gaming case have been arrested on the spot.

The police conducted the raid on an emergency call made by a businessman who had lost some 4 million Hong Kong dollars at the clandestine casino, the sources told the newspaper.

Police believed that the illicit gaming system has been running for over two months and the gang had regularly changed hotels to avoid the detection by the authorities.

The gang mainly targeted Chinese mainlanders and assumedly drugged the customers to cheat them out of their money, said the newspaper report.

Gaming business is legal in the special administrative region where 17 licensed casinos are currently operating.

MACAU -- (PRESS RELEASE) -- Due to overwhelming demand from exhibitors and participants at this year's Asian Gaming Expo, organisers have announced they will return to Macau to host the event again in June 2006.

The decision was made by the Board of the Australasian Gaming Machine Manufacturers Association (AGMMA) which met last week to finalise the dates and locations of three major international gaming expos it will host next year. Auckland was selected for the 2006 New Zealand Gaming Expo on February 22-23, Sydney, Australia, will host the 2006 Australasian Gaming Expo on September 3-5, and

Macau came up trumps as the host city of the 2006 Asian Gaming Expo on June 13-14.

AGMMA Executive Officer Ross Ferrar said the decision to return to Macau was based on the city's strong position in the Asian gaming market.

"There is no other destination in the Asian region that currently parallels Macau's size, revenue or growth potential in terms of gaming," Mr Ferrar said. "We had intended to return to Macau in 2007, but we could not ignore the interest from both exhibitors and participants for the Expo to be held in Macau again next year."

Mr Ferrar said the Board had considered two other Asian venues for the 2006 Expo but had eventually decided in favour of Macau, as it is the world's most exciting new gaming market.

"Macau Tower is simply spectacular, the city is rich in culture and the local people are tremendous which creates a fantastic atmosphere for the event. "Macau is undoubtedly the best option for the 2006 Asian Gaming Expo."

The 2006 Expo will have a similar format to this year's event which included a trade exhibition, industry conference and investment forum.

Mr Ferrar said the 2005 Asian Gaming Expo was a huge success, largely due to the fact it was held in Macau. "The success of the Expo is indicative of the success Macau's gaming tourism industry is experiencing and will continue to experience in years to come. "This year we had to double the exhibition space originally booked to allow for the huge level of international interest in the event, and even then the floor space had sold out with 20 companies left on the waiting list."

Preparations are now well underway for this year's Australasian Gaming Expo in Sydney. The event will be held at the Sydney Convention and Exhibition Centre at Darling Harbour on August 21-23, 2005.

July 20, 2005

K Wah Construction Materials, which won shareholder approval Tuesday to buy Galaxy Casino from real estate tycoon Lui Che-woo and his family, plans to add more than 5,000 workers in Macau over the next 12 months to staff its three new casinos.

In April the Hong Kong stock exchange cleared the way for the company to buy 97.9 percent of Galaxy from KWah chairman Lui Che-woo and his family for HK$18.4 billion. The purchase is being paid for by a combination of 1.84 billion new K Wah Construction shares valued at HK$8 apiece and HK$3.7 billion in interest-bearing notes and cash.

Francis Lui, deputy chairman of KWah Construction and a Galaxy director, said shareholders unanimously approved the sale at a special meeting Tuesday. Galaxy owns the Waldo casino in Macau, which opened last summer. It will build three new casinos over the next 12 months - the Galaxy StarWorld and two new City Clubs.

Galaxy's chief executive Anthony Carter said Galaxy StarWorld, which is set to open in mid-2006, will hire 2,000 workers, while the two City Clubs together will add 3,000 more over the next six to seven months.

Thanks to a labor shortage in Macau, the company will look to Hong Kong for additional workers, Lui said.

Galaxy's massive new casino resort in Cotai, is slated to open in the first quarter of 2008, bringing the company's total investment in new resorts to HK$5.7 billion.

K Wah Construction financial controller William Lo said Galaxy will fund construction of the three new casinos through the sale of about HK$1.9 billion in bonds and HK$1.1 billion in project financing. The rest of the funds will come from the cash flow of its existing casino business, though he didn't rule out seeking additional financing from investors in the future.

Despite taking on debt to pay for these investments, Lo said K Wah Construction still has plenty of room to borrow more, since its debt-to-equity ratio will only rise to about 20 percent, a relatively low level for a listed company, from 12 percent at the end of 2004.

HONG KONG (Dow Jones)--Independent shareholders of Hong Kong-listed K. Wah Construction Materials Ltd. (0027.HK) Tuesday approved the planned acquisition of a majority stake in Macau's Galaxy Casino SA for US$2.36 billion.

The approval at a special shareholders' meeting paves the way for a deal that will create the first listed company in Hong Kong to control one of Macau's three gambling franchises. The company also said Tuesday that apart from the HK$18.4 billion it will pay for the casino - through the issue of new shares, cash and interest-bearing notes - it is also planning to secure HK$3 billion in financing through a bond issue and project financing.

In recent years, Macau has been transformed from a sleepy backwater to a gambling mecca, thanks to keen interest by U.S. casino supremos eager to turn the enclave of 450,000 into Asia's Las Vegas. Macau is already second in the world in gaming revenue behind Las Vegas, spurred by a flood of mainland tourists, and analysts are widely predicting it will overtake the Las Vegas strip's revenue this year. Of the 16.7 million visitors to the city last year - up from 2003's 11.9 million - a whopping 9.5 million came from China.

K. Wah Construction, a unit of K. Wah International Holdings Ltd. (0173.HK), will acquire 88.1% of the voting rights of Galaxy Casino, giving it a 97.9% interest in the company. The stake is being bought from tycoon Lui Che Woo and his family, who control the bulk of Galaxy Casino, and investment firm Guoco Group Ltd. (0053.HK), owned by the Quek family, one of Malaysia's biggest business families. Lui also controls K. Wah Construction.

"We are dedicated to making Galaxy a leading operator of gaming, leisure and entertainment facilities in Macau," said Lui.

Galaxy currently operates just one casino, at Macau's Waldo Hotel, but plans to open another three in the next 12 months. In all, Galaxy plans to invest HK$5.7 billion in those three, plus a casino and entertainment resort in the Cotai strip - a Las Vegas-style strip of casinos and luxury hotels under construction on a reclaimed area of Macau - by 2008.

Still, K. Wah Construction's shares have lost almost half their value since the long-awaited deal was announced. The shares closed at a record high of HK$9.7 on April 19, the day the company said it would buy Galaxy, as investors rushed to grab a stake in Macau's gambling boom. Macau is the only place in China that allows casinos.

Since then, however, K. Wah Construction shares, which were trading below HK$1 before the mania for Macau plays kicked in late last year, have fallen 44%, closing Tuesday at HK$5.45.

To finance the HK$18.4 billion acquisition of Galaxy, K. Wah Construction will raise HK$14.7 billion by issuing 1.84 billion new shares at HK$8 each. The new shares will represent 58.7% of the company's enlarged share capital. It will either issue HK$3.7 billion in floating-rate notes or raise cash through the issue of more new shares to make up the rest of the funds needed for the purchase.

As well, K. Wah said Tuesday that it is in the process of securing about HK$3 billion through a bond issue and project financing. That HK$3 billion will go towards developing one of the new casinos it plans to open in the next 12 months - the Galaxy StarWorld - as well as fund the first phase of its Cotai project. K. Wah said Galaxy has mandated Morgan Stanley and Merrill Lynch to arrange the bond issue, and added the arrangement for the project financing "has entered into its final stage."

Macao's income from direct gaming tax reached 8.15 billion patacas (1.01 billion US dollars) in the first half of the year, an year-on-year increase of 24.9 percent.

Statistics released Tuesday by the Finance Service Bureau showed that the direct gaming tax payments made up 77 percent of the government's total income between January and June.

Macao's 17 casinos pay 35 percent of their gross revenues as direct tax to the government, according to the official figures.

Macao, with a population of nearly 470,000, is the only region in China, where casinos are legal. Local observers expect the number of casinos to exceed 20 within the next two years.

Macau gaming plays have been out of favor recently, but results from Las Vegas Sands, due Aug. 3, "will highlight once again the positive dynamics of the market and could spark renewed interest", says CSFB

LAS VEGAS More than a hundred entertainers and representatives of Macau will be heading to Las Vegas next month -- hoping to spark American interest in visiting their homeland.
From August 8th to the 14, the group will be holding events around town, including a Macau-themed photo exhibit at the M-G-M Grand and cultural performances inside the Fashion Show mall.

"Macau Week" is expected to cost over 500-thousand dollars and will be the Chinese enclave's first such promotional event targeting residents of a far away travel market.

The Macau Government Tourist Office has held similar events in nearby markets, including Hong Kong.

Macau is a familiar name to those in the gambling industry.

By Chris Jones

Las Vegas Gaming Wire

MACAU -- In recent years, the Chinese enclave of Macau has increasingly assumed a Las Vegaslike atmosphere as Strip-inspired casinos take shape along the Pearl River Delta.

Early next month, that cultural migration will reverse course across the Pacific, at least for one week in Southern Nevada.

From Aug. 8-14, more than 100 entertainers and representatives of the Macau Government Tourist Office will be in Las Vegas to arouse American interest in visiting their homeland, a historic Portuguese colony that's been a special administrative region of the People's Republic of China since December 1999.

While the Tourist Office has held similar events in nearby markets such as Hong Kong, a spokesman said next month's $500,000-plus "Macau Week" will be the city-state's first such promotion targeting residents of a long-haul travel market.

"I think most Americans don't know anything about Macau, or maybe have not even heard the name before," Frank De Clara, a Los Angeles-based account executive with Myriad Travel Marketing who serves as the U.S. marketing manager for the Macau Government Tourist Office, said Friday.

"While it's known for its gaming and entertainment, obviously we have a broader story to tell about the culture there and why people should visit," De Clara added.

Like Atlantic City and tribal gaming before it, the word Macau has become familiar to those following gaming locally and in competitive markets.

Las Vegas Sands Corp., which owns The Venetian, in May 2004 opened the $265 million Sands Macau, the first Las Vegas-style casino in Asia.

The company is also involved in the development of the Cotai Strip, an approximately 200-acre parcel of reclaimed land that will eventually house seven hotel-casino projects, including Las Vegas Sands' $1.8 billion Macau Venetian project.

Las Vegas-based MGM Mirage recently broke ground on its $975 million MGM Grand Macau in partnership with Pansy Ho Chiu-king. Separately, Wynn Resorts is building its $1 billion Wynn Macau.

All three projects are scheduled to open in 2007.

Wynn Las Vegas will kick off Macau Week with a special piano concert on Aug. 9, while a 50-piece art exhibition is slated for The Venetian.

MGM Grand will host a Macau-themed photo exhibition, and all three resorts will showcase handicraft demonstrations and offer Macau-inspired cuisine at select restaurants.

In addition, Fashion Show mall will host a VIP gathering with Chui Sai On, Macau's secretary for social affairs and culture. Dancers and artists will also put on cultural performances inside the Strip mall's Great Hall.

Most events will be free to the public, De Clara said. In addition to inspiring locals to visit Macau, the Tourist Office hopes to make a strong impression on many of the nearly 720,000 visitors who visit Las Vegas each week.

De Clara compared the connection between Las Vegas and Macau to a "sister cities" designation, though no such official agreement exists. That bond was echoed by a representative of participating Strip resort.

"This is a continuation of our strong relationship with the government of Macau," Las Vegas Sands Corp. spokesman Ron Reese said early today from Singapore. "We're looking forward to highlighting their culture and heritage at The Venetian."

Matthew Miller, Forbes | July 25, 2005

The $245 billion worldwide gambling business is on a roll these days thanks to the growing number of folks getting hooked on everything from slot machines to online gaming to televised poker tournaments.

A handful of tycoons have gotten very rich as a result and are doubling down. US casino mogul Steve Wynn, who runs Wynn Resorts, spent five years building his $2.7 billion Wynn Las Vegas casino, which opened in April, and is pouring millions more into a new resort in the Asian gambling Mecca of Macau.

MACAU -- In recent years, the Chinese enclave of Macau has increasingly assumed a Las Vegaslike atmosphere as Strip-inspired casinos take shape along the Pearl River Delta.

Early next month, that cultural migration will reverse course across the Pacific, at least for one week in Southern Nevada.

From Aug. 8-14, more than 100 entertainers and representatives of the Macau Government Tourist Office will be in Las Vegas to arouse American interest in visiting their homeland, a historic Portuguese colony that's been a special administrative region of the People's Republic of China since December 1999.

While the Tourist Office has held similar events in nearby markets such as Hong Kong, a spokesman said next month's $500,000-plus "Macau Week" will be the city-state's first such promotion targeting residents of a long-haul travel market.

"I think most Americans don't know anything about Macau, or maybe have not even heard the name before," Frank De Clara, a Los Angeles-based account executive with Myriad Travel Marketing who serves as the U.S. marketing manager for the Macau Government Tourist Office, said Friday.

"While it's known for its gaming and entertainment, obviously we have a broader story to tell about the culture there and why people should visit," De Clara added.

Like Atlantic City and tribal gaming before it, the word Macau has become familiar to those following gaming locally and in competitive markets.

Las Vegas Sands Corp., which owns The Venetian, in May 2004 opened the $265 million Sands Macau, the first Las Vegas-style casino in Asia.

The company is also involved in the development of the Cotai Strip, an approximately 200-acre parcel of reclaimed land that will eventually house seven hotel-casino projects, including Las Vegas Sands' $1.8 billion Macau Venetian project.

Las Vegas-based MGM Mirage recently broke ground on its $975 million MGM Grand Macau in partnership with Pansy Ho Chiu-king. Separately, Wynn Resorts is building its $1 billion Wynn Macau.

All three projects are scheduled to open in 2007.

Wynn Las Vegas will kick off Macau Week with a special piano concert on Aug. 9, while a 50-piece art exhibition is slated for The Venetian.

MGM Grand will host a Macau-themed photo exhibition, and all three resorts will showcase handicraft demonstrations and offer Macau-inspired cuisine at select restaurants.

In addition, Fashion Show mall will host a VIP gathering with Chui Sai On, Macau's secretary for social affairs and culture. Dancers and artists will also put on cultural performances inside the Strip mall's Great Hall.

Most events will be free to the public, De Clara said. In addition to inspiring locals to visit Macau, the Tourist Office hopes to make a strong impression on many of the nearly 720,000 visitors who visit Las Vegas each week.

De Clara compared the connection between Las Vegas and Macau to a "sister cities" designation, though no such official agreement exists. That bond was echoed by a representative of participating Strip resort.

"This is a continuation of our strong relationship with the government of Macau," Las Vegas Sands Corp. spokesman Ron Reese said early today from Singapore. "We're looking forward to highlighting their culture and heritage at The Venetian."

Macau: A Great place to go gambling in when you're away from the internet casinos

Macau might well be the place for online casinos fans who fancy a change from playing online in the form of a flutter in a truly exotic location.

Macau is known as the Las Vegas of Asia, and, with the opening of new, themed resort-style casinos, the comparison is becoming more apt with every year that passes.

This former Portuguese territory, now a special administrative region of China, is the place where residents of neighbouring Hong Kong, where most gambling is illegal, come for a taste of gaming paradise.

Island Boom

The region is tiny - just a small peninsula and two islands. It has a certain amount of old world colonial charm, but it's changing fast. A development boom has come in the wake of investment by Las Vegas operators MGM Mirage and Wynn Resorts Ltd, following of the ending of a 40-year casino monopoly enjoyed by billionaire Stanley Ho.

Gambling in Macau was legalised in 1847 and now the economics of the region very much depend on it, with the gambling industry generating more than 40 per cent of Macau's GDP.

Along The Strip

There are currently around 15 casinos in the region, all of them open 24 hours a day. The best known is the Hotel Lisboa and the most picturesque the Floating Palace Casino, a romantic building that can be found in the outer harbour. Gaming fans can also enjoy horse and greyhound racing in Macau.

Gaming in Macau doesn't generally have the razzle dazzle that is attached to Las Vegas gambling. However, several themed Las Vegas-style casinos have recently opened, including the Sands Macau and the Pharaoh's Palace. There are also plans to open a Mirage and a $1.8billion replica of the Las Vegas Venetian casino, complete with canals, gondolas and shopping malls, within the next few years.

A Great Gambling Selection

What Macau's casinos are well-known for is the range of games several of them offer - possibly the widest in the world. These include western games such as baccarat, blackjack, roulette, craps and boule but also feature Asian games such as big and small, which is played with dice, and fan-tan, which is played with porcelain buttons. There is also a huge array of slot machines, known as "hungry tigers" for gambling fans to choose from.

If you want a change from casinos, you can enjoy a day at the races at the Macau Jockey Club on Taipa Island. This mainly takes place on Tuesdays and Saturdays or Sundays. There's also greyhound racing at the Canidrome Club. Six to eight greyhounds take part in every race and food is available.

House Rules

* Legal age for betting in Macau is 18 for tourists and 21 for residents.
* Although winners are not obliged to leave tips, croupiers will often deduct 10 per cent of winnings.
* Dress codes in casinos vary but are strictly applied. Shorts and sandals are not allowed.
* Cameras are banned in casinos.

July 28 2005

THE odds are strong that Genting Bhd and slots machine distributor Dreamgate Corp Bhd will emerge as winners from Macau’s fast growing gaming sector.

Macau — where gaming revenue is forecast to rise 20 per cent in the next four years — is currently a big construction site with multiple casino and leisure complexes under construction.

Among the developments in downtown Macau include the Wynn Hotel, Grand Lisboa and MGM Hotel.

Several works are on-going in the Kotai Strip where one can see development from Melco-PBL joint-venture through the Park Hyatt chain, Venetian as well as Galaxy. Casino mogul Stanley Ho currently owns Melco while PBL is owned by Australian tycoon Kerry Packer.

According to JPMorgan’s Asia Pacific Equity Research — of the three casino concession holders in Macau — Ho’s casino group Sociedade de Jogos de Macau (SJM) had already awarded two “sub-concession” to PBL and MGM. The other two concession holders are Wynn and Galaxy.

In a report two months ago, the Lim family, which controls the Genting Group, had increased its stake in K. Wah Construction (the company behind Macau’s Galaxy casino) to 6.01 per cent from 4.69 per cent.

K. Wah Construction plans to invest HK$5.7 billion (HK$100 = RM48.78) in the next five years in four new casino projects in Macau.

SJM, which currently has over 1,800 slot machines representing over 60 per cent of market share, has plans to put more effort to boost the revenue from this segment.

It said Dreamgate, the distributor of key slot machine brands in Asia, is a major beneficiary from the coming increases.

JPMorgan places an “overweight” call on both Genting and Dreamgate stocks with a potential upside of about 20.6 per cent and 42.28 per cent respectively.

It has a target price of RM24 for Genting and RM2.10 for Dreamgate stocks.

Zach Coleman


July 29, 2005



Far East Consortium International will add a fifth hotel to the casino resort complex it is building on the Cotai Strip.

Chief financial officer Bill Mok said the first phase of the project will now encompass four hotels with about 2,400 rooms, some 400 more than previously stated. The casino and showroom area to be leased to US operator Las Vegas Sands will expand by 25,000 square feet to 165,000 sqft.

Two of the hotels, a 600-room Holiday Inn and a 417-room InterContinental, are to be managed by InterContinental Hotels Group. The other two hotels, an 800-room Dorsett and a 606-room Cosmopolitan, would be managed by Far East itself.

The first phase is to open in two years. It will be followed months later by a second phase including a hotel with about 1,000 rooms which Far East may hire Marriott International to manage.

Dorsett is a three-star brand Far East has developed and utilized in Hong Kong and other countries.

Cosmopolitan is the Hong Kong-listed company's new four-star brand, introduced with the opening of the Cosmopolitan Hotel Hong Kong in Wan Chai in February. About 10 percent of its 454 rooms are ``family rooms'' which include a small living room area with a sofa bed or room for cots.

Far East officials say the family rooms have been well-received, so the Cosmopolitan Macau will be entirely made up of such mini-suites. ``What we see is that by 2007, there should be more family travelers going to Macau,'' Mok said.

The additional rooms will add about HK$100 million to the HK$2.8 billion cost of the project, which is also sketched to include Macau's largest shopping mall and cinema complex as well as apartments.

Raymond Ngai, a property analyst with JPMorgan, forecast in a recent report that Far East will earn HK$900 million from selling the apartments. He said Far East may also sell the two InterContinental-managed hotels for HK$2 billion-HK$2.4 billion.

Ngai expects Far East to be able to charge HK$15 per square foot for rent in its mall and HK$20 psf to Las Vegas Sands. Given that Far East could recoup the cost of the project by selling just the apartments and two hotels, Ngai said the company could cruise ahead with HK$600 million-HK$700 million in annual income from the mall, Las Vegas Sands and the other three hotels.

Macau’s explosion in casino growth is likely to affect Genting Bhd and Dreamgate Corp Bhd even more than many other gaming and entertainment companies. Under construction in downtown Macau are casinos operated by such giants as MGM and Wynn. On the Kotai Strip, Stanley Ho’s PBL has joined with Australian Kerry Packer’s Melco to work on a venture through the Park Hyatt chain.

Giant K. Wah Construction plans to invest in four new casino projects in Macau over the next five years, putting Genting Group, which controls 6.01% of K. Wah, in a great position for financial growth.

Meanwhile, slot machine distributor Dreamgate is expected to flourish as the rise in casinos will demand a rise in the number of slot machines. Dreamgate is currently the main distributor of slot machines in Asia, and is likely to see a steep rise in revenues.

JPMorgan expect an upside of 20.6% for Genting, making a target price of 24MYR ($6.39), while Dreamgate is expected to rise by 42.28% to 2.10MYR (about $0.56.)

Beijing, China liberalized the gaming restrictions on Macau. And, the Las Vegas casinos are coming to play. The Sands Macau openned its doors last year to great success.

The Fortuna openned its casino in February. The gamers came and played. Fortuna enjoyed crowds ready to play the games of chance.

Wynn Macau is slated to open in 2006. Its establishment is to be as opulent as its Las Vegas sister. MGM Grand Macau and Venetian Macau plan to open in 2007.

Macau is is a short jetfoil ride from Hong Kong. Mainland China is a daytrip away. The casinos will have no shortage of visitors.

Sands Macau raked in US$74.8 million (HK$583.44 million) in operating income for its parent in the second quarter. SIMON SONG

Las Vegas Sands will accelerate and expand its Macau investment plans, the United States-based company said as it unveiled higher earnings for its Sands Macau casino.

The US$1.8 billion (HK$14.04 billion) Venetian Macau casino resort will open with its full complement of 3,000 guest rooms, rather than in two, 1,500- room phases as previously planned, said president and chief operating officer William Weidner Wednesday.

That will make it by far the largest hotel in town at its opening, currently set for the second quarter of 2007. Under the terms of the company's concession from the government, the hotel is supposed to open by next June, though executives say they expect to receive an extension.

Weidner said Las Vegas Sands will develop three other resorts near the Venetian Macau.

The firm, which originally planned to enlist other developers to handle those projects, last month disclosed that it would arrange financing of at least one, and possibly all three.

One will be a 400-room Four Seasons hotel that Weidner said will also include 600 serviced apartments and more than 100,000 square feet of shops.

He said the other two resorts will have 3,000 rooms each, built in multiple phases, along with serviced apartments and a total of 450,000 square feet of retail space.

Leasing of shops in the Venetian Macau has begun and construction of a major expansion of the Sands Macau's gaming floor is scheduled to start next month.

Las Vegas Sands' move into serviced apartments comes after four Hong Kong companies developing casino resorts near the Venetian Macau in the Cotai reclamation area said they would raise funds through pre-sales of apartments.

The New York-listed company said the Sands Macau produced US$74.8 million in operating income on US$205.1 million in revenue in the second quarter, up from operating earnings of US$60.5 million on revenue of US$175.1 million in the first quarter. The Sands opened in mid-May 2004.

The Sands' quarterly take translated into a 14 percent share of total gambling revenue generated from the city's 17 casinos, based on figures released separately Wednesday by the Macau Statistics and Census Service. Those numbers show the Sands captured a third of the market growth from the first quarter.

Much of the Sands Macau's growth came from high rollers, who were targeted with higher rebates on gaming chips they purchased. The casino issued about US$2 billion of VIP chips in exchange for cash or winnings from player's successful bets, up from US$856 million in the first quarter. It generated an average US$6,343 in gross revenue per table per day, up from US$5,467.

Volume growth on public tables was slower as players purchased US$923 million in chips in the second quarter, an increase of 8 percent.

The casino's slot machines also turned in slightly better figures, with average gross revenue per day of US$187, up 4.5 percent.

The company said its win percentages of 2.6 percent on VIP play and 16.6 percent on public-table chip volume were around the industry norm.

Las Vegas Sands (LVS:NYSE - commentary - research) gave a mixed second-quarter performance, as its Macao casino shined like a pearl but its Venetian resort in Las Vegas lost a little luster.

Although a sizeable sequential earnings gain at China's Sands Macao was likely more than enough to assuage jitters about that casino's growth, investors decided to sell after the company reported lower gaming revenue and earnings at the Venetian.

Las Vegas Sands, which went public last December, reported net income of $86.4 million, or 24 cents a share. That compares with $461.9 million, or $1.42 a share, a year before, when profits got a one-time boost of $418.1 million from the sale of the Grand Canal Shops at the Venetian.

Excluding special items, Las Vegas Sands reported adjusted profits of $95.5 million, or 27 cents a share, beating the 26-cent average EPS estimate from Thomson First Call. A year before, adjusted earnings were $39.5 million, or 12 cents a share.

Shares were down 82 cents, or 2%, at $39.60 Wednesday afternoon after losing as much as 4.8% of their value.

Net revenue, which accounts for casino promotions, totaled $398.8 million, up from $266.7 million a year before. The increase was primarily driven by the Sands Macao casino, which was open for only half of last year's second quarter.

"We experienced an exceptional quarter driven largely by record results at the Sands Macao," said William Weidner, the company's president and chief operating officer. "May 18, 2005 marked our one-year anniversary in Macao. We believe the strength of our operating performance and returns to date underscore the potential of the Asian marketplace and make us confident in our long-term plans to not only lead the development of the Cotai Strip, but to be at the forefront of emerging opportunities in other Asian locations."

MACAU – As reported by the China Standard: "The blockbuster budget for the Venetian Macau casino resort in Cotai has climbed to US$2 billion (HK$15.54 billion) and could go higher as owner Sheldo