Of all the achievements in the long life of entrepreneur Lui Che Woo (pictured) – whose death at the age of 95 on November 7 was announced on Monday – the opening in 2011 of the first phase of Galaxy Macau, his flagship casino resort in Macau, must rank among the most transformative in business terms for him and his family.
The launch, on May 15, 2011, of Galaxy Macau, was followed by a two-and-a-half-year period of almost-interrupted growth in Galaxy Entertainment’s corporate value.
What also followed, was years of stellar growth in the consumer appeal of the property. It was no surprise then, that in mid-December 2022, Galaxy Entertainment and the other five incumbent operators in the Macau market, signed new, 10-year concession contracts for gaming rights in the city, following a public tender process.
Throughout all Galaxy Entertainment’s milestone events – including three years of below-par performance for the Macau market, coinciding with the Covid-19 pandemic – the paterfamilias, with his trademark flat cap, kept the appearance of the common touch. He showed few outward signs publicly of the wealth generated from his interest in Galaxy Entertainment, and which helped make him one of Hong Kong’s and Asia’s richest people.
Mr Lui, who also chaired Hong Kong-listed property developer K. Wah International Holdings Ltd, ranked seventh in this year’s “Hong Kong’s 50 Richest People” list, published by Forbes magazine, with a net worth of about US$12 billion.
Forays overseas
His rise led to ambitions to be a global player in casino business. In 2015 the group acquired a stake in a casino operator in the European principality of Monaco and in 2018 it took a stake in Wynn Resorts Ltd, the parent of Macau operator Wynn Macau Ltd.
At times the firm also considered a project for the Philippines, and also looked at getting a casino licence in Japan.
Mr Lui was born in August 1929, in Jiangmen, in mainland China’s Guangdong province, located only about 64 kilometres (40 miles) from Macau, but spent much of his working life in Hong Kong.
His death further weakens Macau’s link to the older generation of self-made gaming magnates. American entrepreneur Sheldon Adelson, creator of Macau operator Sand China Ltd, died in January 2021, just under eight months after Stanley Ho Hung Sun, the founder of Macau operator SJM Holdings Ltd.
Like Mr Ho, Mr Lui had a story starting with relative riches, then to relative rags, and on to riches with a vengeance.
When he was still a small child, in 1934, the family left mainland China for Hong Kong, but was then caught up in the events surrounding the Japanese occupation of that city during the Second World War.
According to his biography for the Lui Che Woo Prize, a charitable initiative he founded, he was “forced to leave his schooling and began to earn a living as a hawker by selling food together with his grandmother”.
He “deeply regretted being deprived of education in his early years,” added the biographical snippet.
Real estate expertise
Mr Lui came to a Macau gaming licence via decades of experience in two other disciplines that have become cornerstones of the modern casino industry with its huge-scale resorts: real estate development, and hotel construction and management.
According to the website of his original money-spinner, K. Wah Group Ltd, a building materials, construction and real estate conglomerate, Mr Lui got his start in business during the 1950s when Hong Kong’s population jumped. The influx stimulated a building boom to accommodate the newcomers.
In 1981 – two-and-a-half decades before Galaxy Entertainment, a spinoff from K. Wah, opened StarWorld, its first purpose-built Macau casino hotel – the Lui family launched the luxury InterContinental Grand Stanford Hong Kong hotel.
Macau’s first stage of casino market liberalisation at the turn of the 21st century after the 40-year monopoly of Mr Ho, had been due to have only three licensees, with the Lui family interests as one of them.
The other two licensees selected initially were SJM Holdings, a successor to STDM, the entity of the monopoly years; and Wynn Macau Ltd, a unit of United States-based Wynn Resorts Ltd.
The Lui family’s Macau licence was supposed to be in partnership with another U.S. firm, Mr Adelson’s Las Vegas Sands Corp.
Ultimately, Las Vegas Sands was permitted to have its own Macau rights, spun off from the Lui family licence, in what was termed a “sub-concession”.
The move also opened the door for two other sub-concessions: one for the MGM casino brand under the SJM Holdings licence, and the other for the Melco brand, under Wynn Macau Ltd’s licence.
‘Asian heart’ and beyond
Galaxy Entertainment launched StarWorld Hotel in 2006, near the city’s traditional casino district, on Macau peninsula.
From the early years of the group’s Macau concession, the firm was keen to differentiate itself from the U.S.-founded competition in that market, by stressing its sensitivity to Asian consumer needs and preferences, via a strategy it referred to as “Asian heart”.
In practice, that meant appeal to mainland Chinese customers, who in the past two decades have made up the bulk of visitors to Macau, and the bulk of gambling customers, according to Macau government data and research by investment analysts.
Nonetheless under the new concessions, Galaxy Entertainment and its market rivals have been given an additional mission by the Macau government – to increase the number and the spending of overseas customers in the Macau tourism sector, including its casinos.
One of the late Mr Lui’s children – Francis Lui Yiu Tung, known for his hands-on approach in the Galaxy Entertainment operation – has for years worked as deputy chairman of the company, while other family members also have senior roles in the business. This might give investors comfort that there will be continuity in the leadership of Galaxy Entertainment, for at least another generation.
