GGRAsia – Pagcor to assess Entertainment City before any new licences

Pagcor to assess Entertainment City before any new licences

Nov 19, 2014 Newsdesk Latest News, Philippines, Top of the deck, World

State-run Philippine Amusement and Gaming Corp (Pagcor) has already received a concept proposal for a casino resort from Caesars Entertainment Corp, but the country’s gaming regulator says it will wait for a “substantial completion” of Entertainment City before deciding on new licences.

Caesars plans to invest more than US$1 billion in a casino resort near the Manila International Airport. The firm’s plan might also include redeveloping the capital’s airport, adding a light rail link for terminals 1 and 2, according to local media reports.

Pagcor told Philippine newspaper BusinessWorld that it has met twice with Caesars’ executives, but stated that discussions “are only at a conceptual stage”.

“In both occasions, Pagcor disclosed that it prefers to see a substantial completion of the Entertainment City to have a better feel of the capacity of the market to absorb new supply before considering a possible fifth licence,” the regulator said, quoted by BusinessWorld.

The Philippines is currently developing an 120-hectare area of reclaimed land close to Manila – known as Entertainment City – into a casino cluster, meant to emulate the success of Macau’s Cotai district.

Each Entertainment City resort has a minimum price tag of US$1 billion. The first property there, Solaire Resort and Casino, opened last year and is owned by Bloomberry Resorts Corp. The second venue, City of Dreams Manila, is due to have a soft opening in December – it is backed by the richest man in the Philippines, Henry Sy, and Macau-based gaming operator Melco Crown Entertainment Ltd.

Other licence holders are: Alliance Global Group Inc and Genting Hong Kong Ltd, which also manage the already-operational Resorts World Manila near the capital’s airport; and Universal Entertainment Corp, controlled by Japanese billionaire Kazuo Okada.

Asked if Caesars’ finances would be a concern, Pagcor told BusinessWorld: “It’s too early to think of anyone’s financial capabilities.”

Caesars, which reported a third-quarter net loss of US$908 million, is facing the prearranged bankruptcy of its Caesars Entertainment Operating Co unit, Bloomberg News reported last week quoting two people with knowledge of the negotiations.

The long-term debt of Caesars’ consolidated business reached US$22.9 billion at the end of September, down from US$24.2 billion at the end of June.

Steven Tight, president for international development at Caesars, said in October that the corporate debt load would not be a barrier to the Manila project.

He told GGRAsia: “We have now created a new entity, Caesars Growth Partners [LLC], that may be the vehicle for investing in the project. They [the entity] certainly have adequate resources and a very strong balance sheet.”