Cambodian gambling firm NagaCorp, which holds a government concession to operate the sole casino in Phnom Penh until 2035, intends to quadruple its gaming table capacity using part of the about HK$800 million fund it hopes to raise from its Hong Kong initial public offering. NagaCorp operates 44 gaming tables and 211 slot machines. The company, controlled by Malaysian businessman Chen Lip Keong, is spending US$90.47 million on an expansion that will boost the number of gaming tables to 176 and add a 508-room hotel when completed by the end of next year. The development will also feature new restaurants and nightclubs, a spa and retail space. Eighty-four tables will be designated for walk-in foreign customers (Cambodians are banned from table games), with the remaining 92 reserved for high-stakes players. The company will spend another US$5 million on casino equipment. In the first five months of this year, revenue from high-stakes players reached US$22.2 million, or 58.4 per cent of total turnover at the firm's casino, Nagaworld. Mainland customers accounted for 36 per cent of VIP chip purchases, followed by Malaysians at 32 per cent and Singaporeans at 19 per cent. The average winning per table per day at the company's mass-market tables was US$4,001 in the first five months, up from US$2,830 a year ago. That compares with a winning per table per day of US$8,693 in Macau in the second quarter and US$2,293 on the Las Vegas Strip in June. NagaCorp benefits from a bargain-basement effective tax rate of 5 per cent, compared with 39 per cent in Macau. But Nagaworld caps maximum betting at lower levels and is more conservative about extending credit to junket operators and high-stakes players than most Macau casinos. The share sale was delayed twice earlier this year after the Hong Kong stock exchange required NagaCorp to perform multiple reviews of its anti-money-laundering controls. NagaCorp is selling 500 million shares priced between HK$1.25 and HK$1.60 per share, with 10 per cent of the issue designated for retail investors and the rest for institutions. Bookrunners Anglo Chinese and Kim Eng started taking orders from institutional investors last week and the offer was fully subscribed as of yesterday, according to market sources. The public offer opens today and runs until October 11. The shares begin trading on October 19.
