Genting Stuns Gamng World By Entering Macau Re-Tendering Fray
Posted on: September 14, 2022, 02:20h.
Last updated on: September 14, 2022, 04:02h.
Genting Malaysia stunned the gaming industry with an 11th-hour bid to procure a Macau casino license.
The submission period for new concessions in the special administrative region (SAR) closed today. Just hours before the deadline arrived, a woman representing an entity known as GMM delivered a proposal to the group tasked with evaluating bids for Macau gaming licenses.
The woman, identified only as Mrs. Chen, confirmed GMM is tied to Genting Malaysia, naming Chairman and CEO Lim Kok Thay as the leader of the gaming company’s surprise Macau effort.
Mr. Lim Kok Thay wanted to come to Macau [to submit Genting’s bid] but he couldn’t come because of the pandemic,” Chen told local media.
Genting, which is one of the dominant, large-scale integrated resort operators in the Asia-Pacific region, had some exposure to Macau via its control of Genting Hong Kong, which has a 50% stake in an entity known as Genting Macau. However, that company doesn’t own a casino resort in the SAR.
Genting Macau Bid Somewhat Surprising
Genting’s decision to get involved in the Macau retendering process is surprising, because the SAR’s new gaming laws allow for six concessionaires — the current amount operating there.
Those six are Galaxy Entertainment, Melco Resorts & Entertainment (NASDAQ: MLCO), MGM China, Sands China, SJM Holdings, and Wynn Macau. All of those companies submitted bids to renew their Macau permits. Entering the retendering process, it was widely expected corporations beyond those six wouldn’t get involved simply because that group is established in Macau and SAR regulators made clear just six concessions will be granted.
On the other hand, it can be argued that Genting entering the Macau competition isn’t surprising. That’s because the Chinese territory is the obvious omission from the company’s sprawling Asia gaming portfolio, which includes Resorts World Genting in Malaysia and Resorts World Sentosa, which is one of two integrated resorts in Singapore.
Parent company Genting Bhd. also owns several US casinos, including Resorts World Las Vegas, the newest, most expensive property on the Strip.
How Genting Could Enter Macau
Exactly how Genting can pull off a Macau license remains to be seen. Regulators there aren’t signaling any willingness to expand beyond six concessions. It’s also not clear that they’re willing to yank an established operator’s license.
If that is the course of action Macau authorities pursue — and there are no signs that will happen — it could make the three concessionaires with ties to US parents vulnerable, owing to frosty geopolitical relations between the US and China.
Those operators are MGM China, Sands China, and Wynn Macau. To be clear, Macau authorities haven’t overtly said any of the six current concessionaires are in danger of losing their permits.
That leaves acquiring an established Macau operator. Genting has the financial resources to do that, but it’s also a matter of finding a willing seller. Galaxy and Sands China – the SAR’s two largest operators – are unlikely sellers. Neither Melco, MGM China, nor Wynn Macau are positioned as targets. That leaves SJM Holdings, which is the most financially flimsy of the Macau operators. But it hasn’t said it’s for sale, and Genting hasn’t said it’s looking at dealmaking as an avenue for Macau entry.