Casino fallout hits Star Cruises stock

Shares drop up to 18.8pc after company exits Singapore deal and announces costs for Macau project rise to HK$3.5b

Shares in Star Cruises sank as much as 18.8 per cent yesterday after the company pulled out of a US$3.4 billion Sentosa Island casino resort to appease Singapore's gaming regulators.

The stock was also hurt by an announcement that the company would need an additional HK$875 million to fund a Macau casino to be operated by Stanley Ho Hung-sun.

The world's third-largest cruise liner, a unit of Malaysia's Genting Group, said it would now shoulder HK$3.5 billion of the total HK$4.7 billion investment cost for the Macau project, 33 per cent more than its previous commitment announced in January.

The difference was supposed to be funded by the cruise line's Singapore-listed sister firm Genting International, which pulled out of the project during the weekend, when both companies agreed to swap stakes in the Singapore and Macau casino developments in order to ease the city state's regulatory concerns over their partnership with Mr Ho.

In January, Mr Ho, with his fourth wife Angela Leong On-kei, acquired a 4.6 per cent stake in Star Cruises, and his privately held Sociedade de Jogos de Macau agreed to operate the planned Macau casino.

Shares in Star Cruises, which had been suspended since Monday, yesterday closed 8.97 per cent lower at HK$2.13.