Analysts at brokerage JP Morgan Securities LLC say they believe that “some form” of gaming regulation in the United Arab Emirates (UAE) might be “released before the end of the year”.
“We view the establishment of the General Commercial Gaming Regulatory Authority (GCGRA) as a significant development,” wrote JP Morgan Securities analysts Joseph Greff, Ryan Lambert and Samuel Nielsen in a Friday memo.
“We are encouraged by the GCGRA’s leadership team’s general industry expertise and ties to U.S. based gaming operators and regulatory agencies,” they added.
Jim Murren, a former chairman and chief executive of casino group MGM Resorts International, had been appointed chairman of the GCGRA, the UAE’s news agency said earlier this month.
The announcement added that Kevin Mullally had been named as chief executive of the GCGRA.
“While the interest in UAE from U.S. gaming operators is not new, we see recent developments as a momentum-building event that, within the context of CEO public commentary from Wynn/MGM, makes us think that more news may come before year-end,” stated the JP Morgan team.
One of the emirates that is a member of UAE’s federal structure – Ras Al Khaimah – is to host a US$3.9-billion casino resort called Wynn Al Marjan Island, to be managed by Wynn Resorts Ltd, the parent of Macau operator Wynn Macau Ltd. The resort is to be on reclaimed land (pictured).
Last month on Wynn Resorts’ second-quarter earnings call, its chief executive Craig Billings said the group expected its gaming licence for Ras Al Khaimah “imminently” . The group has said the property might open in early 2027.
Bill Hornbuckle, chief executive and president of casino operator MGM Resorts International, told an investment event last week that the firm believes it can to be authorised to operate a casino in the UAE.
“We hope and believe… that we can push” an in-development resort project in Dubai, in the UAE, “forward, up to – and including – gaming”. Though Mr Hornbuckle added: “I can’t speak to the timing. I don’t know.”
In Friday’s note, JP Morgan noted that the “timing of licensing” for Wynn Al Marjan Island was“fluid”. That was because “much of the process requires educating lenders who have, until now, been unfamiliar with gaming and require clarity,” suggested the institution.
The analysts added: “The UAE is motivated to facilitate the process given the underlying tourism and economic benefits from this project, which brings incremental demand to other projects in the market, higher employment (and taxes on higher income levels), and higher land values.”
They also said that the licensing process needed “to move in parallel” with the financing of the project, “which up until this point has largely been funded by cash and equity from both joint venture partners”.
“Wynn is leading the syndicate of global and local banks through the preparation of what we expect to be circa US$2 billion of leverage,” added the analysts.
