The balance sheet of Macau casino operator MGM China Holdings Ltd is considered by its parent MGM Resorts International to be “under-levered”, which is a factor making the Macau unit an attractive vehicle for any foray into Thailand by the MGM casino brand.
That is according to Jonathan Halkyard (pictured in a file photo), chief financial officer (CFO) of the parent.
He stated: “The MGM China balance sheet is… under-levered compared to the performance of that business… thus the appeal potentially of using that balance sheet as a vehicle to develop a property in Thailand.”
The group CFO was speaking at the JP Morgan Gaming, Lodging, Restaurant and Leisure Management Access Forum 2025. It was held on Thursday in Las Vegas, Nevada, in the United States, the base of MGM Resorts.
Bill Hornbuckle, chief executive and president of the parent, had mentioned on the parent’s second-quarter earnings call last year, that any investment in Thailand by the MGM brand was likely to come via MGM China.
Mr Hornbuckle stated at Thursday’s investment forum, referring to Thailand legalising casinos: “I think it won’t go as fast as they all would like to think it will. But I would like to think by the first part of next year – the first or second quarter – there’s real legislation and there’s a real process.”
He added: “They’ve talked about five locations: two in Bangkok and three other locales. We’ve stated publicly that if we did anything there, it’d be through our MGM China entity. And that’s still the plan [and it will be] an amazing marketplace.”
Mentioning that “nothing’s cheap to build anymore,” Mr Hornbuckle suggested development costs in Thailand could be “35 to 40 cents on the dollar compared to anything here [in the U.S.] and even cheaper to operate”.
The CEO stated regarding Thailand: “If you were lucky enough to get a licence and build something of substance, it’s a meaningful market and I think the margin in that business would be pretty extensive.”
Thailand is currently discussing a bill that would legalise casino resort business.
A Thursday report suggested four locations could be front runners to host casino complexes: the capital Bangkok; Chon Buri, an eastern province that is home to the internationally-popular beach resort Pattaya; Chiang Mai, a popular tourist destination in the north of the country; and Phuket, a large island off the southern coast with many beach resorts.
MGM Resorts is already committed to major capital spending elsewhere in Asia. It is developing with partners a JPY1.27-trillion (US$8.57-billion currently) casino resort in Japan. MGM Osaka is due to have a ground breaking ceremony on April 24, and launch in 2030.
CreditSights Inc, a ratings institution, said in a note last month, that MGM China’s leverage metrics remained “healthy” and could show a “slight improvement” within this year.
As of December-end, MGM China’s unrestricted cash balance – cash, cash equivalents and short-term investments in debt securities – stood at US$685 million, while its total debt was US$3.0 billion, according to CreditSights.
In late February, Bloomberg reported MGM China – which runs the MGM Macau and MGM Cotai resorts – was in talks with “over a dozen banks” about acquiring an “around US$2 billion” syndicated loan.
