United States-based casino group Las Vegas Sands Corp expects would-be bidders in the upcoming retender of gaming rights in Macau, will be required to commit to a “substantial capital investment,” stated Robert Goldstein, the group’s chairman and chief executive.
He was speaking on Wednesday, during the fourth-quarter earnings call for the group, a day after being confirmed as the group’s new CEO. He had been acting chairman and acting CEO since January 7, when it had been announced that Sheldon Adelson, founding chairman and CEO, was on medical leave for treatment for cancer. Mr Adelson died on January 11.
Las Vegas Sands is the parent company of Macau gaming operator Sands China Ltd.
Macau’s current six gaming licences expire in June 2022. The city’s Chief Executive can extend the existing concessions for an aggregate of up to five years, as allowed under the current gaming law.
“I believe that when Macau makes a decision, there is going to be a requirement to invest more,” said Mr Goldstein. “That’s how Sheldon felt – ‘I can’t wait to invest another US$5 billion or US$10 billion’,” he added, referring to the late chairman’s thoughts on the matter.
Mr Goldstein said additionally that a decision by the Macau government regarding the retender process would be “contingent upon a rather substantial capital investment.”
“We are not done in Macau, and we want to be there for many more years,” added Mr Goldstein.
In December, Macau’s leader left the door open to a potential extension of the existing six casino concessions. The city’s government had previously said it had no plans to delay the launch of a fresh public retender process for Macau’s gaming rights. But the local authorities have not so far provided a clear timetable for the retender process.
Sands China’s president, Wilfred Wong Ying Wai, said on the quarterly call that the company has “not been told of anything at this stage” regarding the retender process. “Consideration is now being given to what the conditions should be for the new concessions,” he stated.
“We are eagerly waiting for the [Macau] government’s direction, because … we only have about 17 months left before the concession expires,” said Mr Wong, adding that the entire process was “coming up against a very tight timetable.”
On the call with investment analysts, Mr Goldstein also said Las Vegas Sands remained “very committed to long-term investment” for its Marina Bay Sands resort in Singapore.
The CEO said additionally that the company was looking at other possible opportunities in the U.S., including in New York and Texas. The group was also “learning and observing” regarding opportunities in the “digital” segment, but it had “nothing to report yet,” stated Mr Goldstein.
Patrick Dumont, now president and chief operating officer for Las Vegas Sands, said the company would consider a number of factors before moving to reinstate its dividends.
“The way we will look at the dividend is to evaluate our capital trajectory, and the portfolio of the business, and then make an assessment on how to restart it and what the trajectory of that dividend will look like,” he said.
Regarding the possibility of selling the group’s assets in Las Vegas, Mr Dumont said it was not a priority, but that the company was “always looking at new opportunities” and at ways to maximise returns for the group’s shareholders.
“If there is a way to do that, we are going to do it, and we constantly look at the assets we have in our portfolio,” he added.
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