Macau plan for satellite casinos surprise says investor
The Macau government’s proposal in its gaming regulatory bill, to have the city’s so-called “satellite” casino venues tie their premises to local gaming concessionaires, was “surprising”, says an investor in a satellite operation, in comments to GGRAsia.
The extinction of satellite casino operations in Macau could not be ruled out in the future, stated respectively the investor, and a Macau gaming scholar.
The consultation document regarding amendment of Macau’s gaming law framework, issued in September, “did not mention the treatment of satellite casinos,” observed Hoffman Ma Ho Man.
He is an executive at Hong Kong-listed Success Universe Group Ltd, an investor in the Ponte 16 casino resort, which uses the gaming licence of SJM Holdings Ltd.
A summary of the Macau gaming law amendment bill was revealed on Friday. The current six Macau licences expire in June, and the government has said a new regulatory system must be in place before a fresh public tender on Macau gaming rights can take place.
The city’s satellite casinos will, under the proposed bill, have a three-year grace period to tie the ownership of the premises to any one of six gaming concessionaires that will be permitted in the Macau market.
“Is that a transfer of… 100-percent ownership,” to a concessionaire, “or are there any particular shareholding requirements?” wondered Mr Ma in his comments to GGRAsia.
“If what the government proposed for the satellite casinos is to be enacted, it would boil down to an issue between the satellite casino investors and the gaming concessionaire: whether the asset in question is to be sold on a reasonable price or not?” added Mr Ma.
Currently, there are 18 satellite casinos in the city: 14 use SJM Holdings’ rights; three use Galaxy Entertainment Group Ltd’s rights; and one uses Melco Resorts and Entertainment Ltd’s licence.
Wang Changbin, director of the Centre for Gaming and Tourism Studies at Macao Polytechnic Institute, told GGRAsia: “In regulatory terms, the proposed bill does clear up the oversight issues relating to satellite casinos.”
But he added: “In economic terms…that could mean some potential loss of client network in the event that the satellite casinos fail to see their premises acquired [by gaming concessionaires] and the gaming operation is terminated.”
Under the proposed law, the current satellite casino investors would “possibly have no role as a gaming operator any more unless they have become a gaming concession bidder, or the shareholders in these bidding companies,” said the scholar.
Casino games maker and casino management firm Paradise Entertainment Ltd, told GGRAsia that it was unable to comment on the topic of satellite casinos and the draft gaming law amendment.
The Hong Kong-listed firm controls LT Game Ltd, a brand that provides electronic gaming equipment and management technology for casinos. Paradise Entertainment also runs casino operations at Casino Kam Pek Paradise, under the licence of SJM Holdings.
Ambrose So Shu Fai, vice chairman and chief executive of SJM Holdings, was quoted on Monday by Ming Pao, a Chinese-language newspaper in Hong Kong, as saying that for Macau satellite venues, a new “cooperation” model would need to be negotiated with gaming concessionaires.
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