Local partners to be at heart of Japanese resort: MGM exec
U.S.-based casino operator MGM Resorts International is “committed to working hard” with local partners to develop a casino resort with unique features in Japan, said on Wednesday the firm’s senior vice president of global gaming development, Ed Bowers.
Mr Bowers highlighted the role Japanese partners could play in the construction of an integrated resort in Japan. “MGM has never built a building in Japan: we are unfamiliar with Japanese construction companies, with Japanese construction techniques and Japanese construction subcontractors… This is why MGM absolutely needs the knowledge and expertise of Japanese corporate partners,” Mr Bowers said.
He also mentioned potential partnerships in other areas, including retailing and food and beverage operations.
Mr Bowers was speaking during a company presentation on the first day of the Japan Gaming Congress in Tokyo. The conference about the nascent Japanese casino sector has been organised by Clarion Events Ltd.
“We believe that partnerships will be at the heart of the Japanese integrated resort. Partnerships that start here in Japan,” Mr Bowers said.
In a presentation in 2014, MGM Resorts said it planned to bring together “a consortium of leading Japanese companies” for an eventual casino resort in Japan.
A potential US$10-billion price tag on a Japan casino resort is “a good number to use at this point in time”, said in February James Murren, company chairman and chief executive.
Several investment analysts covering the gaming sector have suggested that foreign casino operators will have to find local partners to be able to bid for a casino licence in Japan. Those details are yet to be decided and will only be included in an implementation bill, still being drafted.
Japanese brokerage Nomura said in a December note it expected “Japanese industrial/entertainment conglomerates to compete aggressively for the two to three expected [casino] licences” in Japan. It stated it was likely for any casino project in Japan “to be majority owned by Japanese companies, but there is an important role to be played by experienced international casino companies with design and operating expertise”.
“Our vision for a Japanese integrated resort diffuses the values, cultures, experiences and expertise of Japanese partners and MGM,” Mr Bowers said in his Wednesday presentation. He did not mention whether the firm would seek a majority stake in a Japan scheme.
The MGM Resorts executive stated that the company was experienced in developing casino resorts in partnership with other parties. Mr Bowers mention the US$9-billion CityCenter complex, launched on the Las Vegas Strip in December 2009, in partnership with the Dubai World group, a holding company controlled by the government of Dubai. He also highlighted the case of Macau-based casino operator MGM China Holdings Ltd, initially a 50-50 joint venture with local businesswoman Pansy Ho Chiu King – MGM Resorts now controls the firm with a 56-percent stake, but Ms Ho remains a significant shareholder, controlling around 22.5 percent of MGM China.
MGM Resorts had declared itself a candidate for a Japanese casino gaming licence long before lawmakers in that country passed on December 14 a bill to legalise such business. Mr Bowers noted during his Wednesday presentation that the firm first established a permanent “on-ground presence” in the country “more than three years ago”.
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