Japanese entertainment conglomerate Sega Sammy Holdings Inc says it plans to spend “approximately” JPY120.0 billion (US$1.09 billion) towards the cost of a casino resort it wants to create in Yokohama city (pictured), Japan, as part of a consortium including Genting Singapore Ltd.
Such spending would be “on a cumulative basis up to business start date,” which Sega Sammy assumes would be in the “late 2020s”.
The Japanese group is already a partner in the Paradise City casino resort at Incheon, South Korea, and produces casino electronic games as well as running an extensive pachinko business in its home market.
A recent note from Maybank Investment Bank Bhd used a potential 50 percent investment from Genting Singapore in a Yokohama project as the basis for projections on future earnings from such a scheme. Genting Singapore runs the Resorts World Sentosa casino complex in Singapore.
Sega Sammy said in a Friday announcement: “We assume that the consortium will become the main entity, but the details are undecided.”
The Japanese group further noted that the amount it would spend on Yokohama might “fluctuate depending on the ratio of borrowings from financial institutions and other factors in the future”
It added: “Even if the maximum expenditure is made, we expect that this business will not be included in the scope of consolidation of the company.”
Yokohama city concluded on Friday its request-for-proposal (RFP) submission period regarding commercial partners for its tilt at getting a casino complex or integrated resort (IR), as they are known in that country.
Local authorities interested in hosting a casino resort must first select a commercial partner, and then apply to the national government for the right to host such a facility. The Yokohama authorities are expected to choose a suitor this summer, according to a previously-announced timetable. Up to three resorts will be permitted in Japan under the relevant legislation framework.
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DS Kim, Amanda Cheng and Livy Lyu
Analysts at brokerage JP Morgan Securities (Asia Pacific)