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US gaming giant says joint venture wants to build more than one casino in Macau

Although MGM Mirage broke ground for its first casino in Asia only yesterday, the American gaming giant is already looking for more projects in Macau.

'We definitely want to build more than one casino in Macau,' said MGM Mirage chief executive Terry Lanni. 'Cotai [reclaimed land between Taipa and Coloane] is a possibility, so is Taipa.'

MGM Mirage's local partner, Pansy Ho Chiu-king, daughter of Stanley Ho Hung-sun and managing director of Shun Tak Group, agreed, saying the MGM Grand Macau would provide the experience needed to develop more projects.

'As we focus on doing well in our first project, we'll learn more about the operating environment and working conditions,' Ms Ho said. 'No doubt that will benefit any projects in the future.'

The plans for the US$975 million MGM Grand Macau, a 600-room hotel and 300-table casino, were unveiled yesterday. The 33-storey resort will feature 16 VIP gaming rooms, with 71 tables, and a mass-market gaming area with 232 tables and 1,000 slot machines.

Convention facilities will cover another 1,250 square metres of floor space. The resort will also include a 1,500-seat theatre and a night club.

Located next to another casino, being built by Las Vegas  operator Steve Wynn, and near the Lisboa hotel casino, which is owned by  Mr  Ho, MGM Grand Macau is slated to open in late 2007.

MGM Mirage lost out in the 2002  auction of Macanese casino  licences but found  a way to join in the action by forming  a 50-50 joint venture, called MGM Grand Paradise, with  Ms Ho a year ago.

Mr Lanni said MGM paid  Mr  Ho's Sociedade de Jogos de Macau   for a sub-concession to run the casino, but declined to disclose how much. 'It will be announced in due course,' he said. The Macanese government finally approved the sub-concession in April this year.

However, the project still hinges on MGM Mirage gaining approval from two of the three gaming commissions that cover the areas in which it operates in the United States. It received the go-ahead in February from the Mississippi gaming control board but still awaits decisions from Nevada and New Jersey.

The Nevada Gaming Commission launched an investigation into Ms Ho and may require the businesswoman to apply for a licence if they feel there are concerns. It has yet to be decided whether Ms Ho must face an inquiry in Nevada.

Asked how long it would take for  MGM Grand to recoup its cost, Ms  Ho said no one should expect Macau's casinos to replicate the success of Sands, which paid  for itself within a year.

'It is a mistake to think that casinos should aim at recouping cost as fast as possible,' she  said.  'The Sands' achievement was made under special circumstances ...  it was the first new casino to enter the market.'

The project is being financed partly by a US$600 million syndicated loan. The companies are in talks with banks for the loan.

Macau overtook Atlantic City last year to become the world's second-largest gaming market.



MGM unveils US$975m project