MGM China builds presence in Cotai strip with new resort
Macau casino operator MGM China broke ground for its HK$20 billion Cotai project yesterday. It expects the resort to open to customers in the middle of 2016.
The joint venture between Pansy Ho Chiu-king and MGM Resorts International now runs one casino on the Macau peninsula. It lacks a presence on the busy Cotai strip, which hosts a cluster of casinos operated by rivals including Sands China and Galaxy Entertainment.
The new project is being built amid concerns that Beijing's new leadership, which officially takes over next month, will crack down on corruption.
Macau's lucrative high-roller business relies largely on officials and entrepreneurs from the mainland.
"So far we haven't received any notice or requirement to co-operate [with the government in this respect]," chairman Ho told reporters after the groundbreaking ceremony. "There's never been any real, concrete indication or direction from the government. Although the growth of the VIP business may slow, I'm not aware of any crackdown."
She said facilities to be added in coming years to Macau would lead to faster growth in the mass market. "But it doesn't mean the VIP market will suddenly change drastically," she said. "What you will see is the growth of the VIP business might not be maintained at double digits."
Ho said she had no plan to reduce her 27 per cent stake in MGM China.
Bill Hornbuckle, the chief marketing officer of MGM Resorts, said there had been a "strong comeback" in business from VIP gamblers after the week-long Lunar New Year holiday ended on February 17.
MGM's Cotai project will have 1,600 hotel rooms, 2,500 slot machines and up to 500 gaming tables.
Shares in MGM China fell 1.4 per cent yesterday to HK$18.48, while the benchmark Hang Seng Index edged up 0.25 per cent.
Meanwhile, Macau's largest casino operator, SJM, chaired by Ho's father, Stanley Ho Hung-sun, posted a rise of 27 per cent in net profit for last year to a record HK$6.75 billion. It proposed a special dividend of 30 HK cents per share, on top of a final dividend of 50 HK cents.