Credit and market research provider CreditSights Inc says it continues to view the privatisation of Malaysian casino firm Genting Malaysia Bhd as “unlikely”, following the closure of the takeover bid from its parent, Genting Bhd.
In mid-October, Genting Bhd made a circa US$1.59-billion offer to acquire all shares in Genting Malaysia that it didn’t already own, aiming to delist the unit from Bursa Malaysia. At the time, the parent held a 49.99-percent stake in the casino firm.
But Genting Malaysia is to remain listed, after the parent’s bid fell short of the 75-percent threshold needed to trigger delisting from Bursa Malaysia.
In a Monday filing with the bourse, Genting Bhd said that as of 5pm on December 1, it had managed to secure a 73.13-percent interest in the Genting Malaysia at the close of its offer.
An independent advisor to Genting Malaysia had said that the MYR2.35 (US$0.56) per-share price being offered by the parent was “not fair and not reasonable”. It recommended existing shareholders “reject” the offer.
“We are surprised at the robust shareholder participation rate that was stronger than we had expected,” wrote CreditSights analysts Lakshmanan and Jonathan Tan Jun Jie in a Tuesday memo.
“We anticipated Genting Bhd to succeed at only acquiring 10 percent to 15 percent additional stake in Genting Malaysia (i.e., total final stake of 60 percent to 65 percent), given the unattractive offer price,” they added.
CreditSights, a unit of Fitch Ratings, observed that Genting Bhd was now “restricted from purchasing additional voting shares in Genting Malaysia and/or announcing further takeover offers in Genting Malaysia over the next 12 months”.
“Of course, Genting Bhd could seek to acquire [an] over 2 percent stake through open market purchases to lift its stake in Genting Malaysia to over 75 percent after the 12-month cooling period, effecting a delisting,” noted the analysts.
They added: “Ultimately, we don’t think Genting Bhd’s priority is to delist Genting Malaysia, but rather to strengthen control and [its] stake in Genting Malaysia, which it has successfully done.”
Genting Malaysia runs the Malaysian casino monopoly Resorts World Genting, as well as casinos in the United States and the Bahamas, and in the United Kingdom and Egypt.
The CreditSight analysts also commented on a unit of Genting Malaysia, Genting New York LLC, being recommended to receive a downstate New York casino licence in the United States.
Last month, the Genting group affirmed that the Resorts World New York City complex in the borough of Queens – currently offering electronic gaming – could become a fully-fledged casino and “begin operations as early as March 2026”.
Genting New York’s proposal entails a US$5.5 billion expansion up to 2030, and a US$600 million upfront licence fee, in exchange for a 30-year licence.
“We view the development positively for Genting Malaysia,” stated the CreditSights team. “We expect Genting New York’s earnings to nearly double in financial year 2027 once Phase 1 of the New York expansion completes through the second half of 2026.”
