Macau-based casino operator MGM China Holdings Ltd, which promotes the soon-to-open MGM Cotai casino resort (pictured), is likely to receive 150 new-to-market gaming tables, suggests brokerage Deutsche Bank Securities Inc.
“We estimate MGM [China] receives 150 tables, though we do not believe the allocation is overly meaningful given the ability to shift capacity from the peninsula and investor comfort that table utilisation remains low, post the Wynn Palace opening experience,” analysts Carlo Santarelli and Danny Valoy wrote regarding MGM Cotai in a note issued on Wednesday.
The Macau government operates a table cap policy, effective since 2013, designed to limit compound annual growth in the number of new live-dealer tables in the city’s casinos to 3 percent until the end of 2022, from a base of 5,485 tables recorded at the end of the fourth quarter of 2012.
Deutsche Bank’s note mentioning the likely table allocation for MGM Cotai followed what the bank said were meetings recently in Las Vegas, Nevada in the United States with respective managements of several casino firms.
Earlier this week MGM China said that it is to host an “official grand opening ceremony” for its MGM Cotai resort on February 13. But the company release did not clarify why the ceremony would be later than the January 29 opening to the public announced in September. The January 29 launch for the HKD27-billion (US$3.46-billion) property is subject to it receiving all government approvals.
Macau’s casino regulator, the Gaming Inspection and Coordination Bureau, told GGRAsia – in an emailed response to a question from us regarding the table allocation for MGM Cotai – the gaming bureau had not received any application from MGM China requesting new gaming tables at MGM Cotai.
MGM Cotai will be MGM China’s second Macau casino property. The firm currently operates MGM Macau, in the city’s traditional downtown casino district.
“Management reaffirmed that MGM Cotai will open with direct VIP only, with junkets expected to begin to come online in the late first-quarter 2018/early second-quarter 2018 timeframe,” the Deutsche Bank analysts wrote in the Wednesday note.
MGM Cotai will offer approximately 1,400 hotel rooms and suites, meeting space, high-end spas, shops and restaurants, according to previous releases by MGM China. The casino resort would also feature what is described as “the first international Mansion at MGM” – a branding term used to describe some luxury accommodation within MGM Resorts’ properties in other markets.
“Management is targeting a second-quarter 2018 opening of the Mansion, though we believe this element of the project could slip into the second quarter, 2018,” the Deutsche Bank analysts wrote in the note.
Two other Cotai casino resorts that opened in 2016 – Wynn Palace and Parisian Macao – each received 150 new-to-market live gaming tables in phases.
Shortly before the US$4.4-billion Cotai resort Wynn Palace opened on August 22 2016, Macau’s Secretary for Economy and Finance, Lionel Leong Vai Tac, had said that the property was to receive 150 new-to-market live gaming tables; 100 of them in time for its launch. Mr Leong had added that Wynn Macau Ltd was to be granted an additional 50 new-to-market tables in two separate phases: 25 tables as of January 1, 2017; and the remaining 25 on January 1, 2018.
The same-size new-to-market table allocation was granted to the US$2.7-billion Parisian Macao: 150 tables, with 100 for its opening on September 13, 2016 and 50 in two equal tranches on, respectively January 1, 2017 and January 1, 2018.
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"On March 20, 2018, Mr Wynn disclosed that he intends to sell all or a portion of the common stock controlled by him … in the open market … or in privately negotiated transactions”