Macau Seedy Casino Industry a Goldmine

Written by:
Jagajeet Chiba
Published on:

In an article published by the Sydney Morning Herald Tuesday morning, it is revealed how Macau's casino industry has flourished despite a worldwide economic crisis.  Gaming revenue has roared above that of Atlantic City and Las Vegas combined according to the report.

One of the primary reasons for Macau's success:  Families from Mainland China are flooding the city.

"They don't drink and they don't like to waste money on consumption when they could be investing it on the baccarat table," says Glenn McCartney, who runs a Macau casino tourism consultancy called Insights Unlimited. James Packer and Lawrence Ho, with their Melco Crown joint venture, are punting that they can work the cultural contours of Chinese gambling better than anyone else.

China's economy is defying the world trend it seems. China's gross domestic product expanded 7.9 percent in the second quarter as the nation became the first major economy to rebound from the global recession.

But Macau and its casinos received yet another boost on Monday after China decided to ease restrictions on its citizens traveling from Guangdong province to Macau, sending casino stocks soaring.

More than three-in-five gamblers in Macau come across the border in mainland China and they're losing money at a rate the world has previously never seen. "September looks like being 30 per cent to 40 per cent up on September 2008," says David Green, a PricewaterhouseCoopers gaming consultant to Macau.

Gambling magnates Packer, Steve Wynn and Macau's deeply rooted Stanley Ho all look to take full advantage.

Wynn expects to make out like a bandit by raising as much as HK$12.6 billion ($1.63 billion) in a Hong Kong initial public offering of its Macau casino assets, two people familiar with the matter told Bloomberg News on Monday.

Global investors are likely to be drawn to the IPO as it's the first foreign casino operator to be listed in Hong Kong, said Steven Leung, an institutional trader at UOB-Kay Hian Ltd.

Six cornerstone investors have pledged to buy up to $250 million of the shares, the draft prospectus said. These include Malaysian billionaire Quek Leng Chan, who controls Hong Leong Co., agreeing to buy $80 million.

Walter Kwok, who last year was ousted as chairman of Hong Kong developer Sun Hung Kai Properties Ltd., agreed to buy $20 million while Thomas Lau, brother of Hong Kong billionaire Joseph Lau, will buy $50 million, the document said. CMY Capital Markets Sdn. Bhd., a Malaysian company controlled by Chua Ma Yu, will buy $70 million, it said.

Wynn expects China to ease travel restrictions for citizens of Mainland China even further over the next year.

Jagajeet Chiba, Gambling911.com





Business/Financial News

Lithuania Dabbles in Crypto-Coin as Central Banks Look for Ways to Fend off Facebook

Lithuania Dabbles in Crypto-Coin as Central Banks Look for Ways to Fend off Facebook

Lithuania is about to issue the first central bank-produced digital coin in the euro zone, part of a project to trial state-backed digital currencies and blockchain technology in everyday use.

'Sophisticated' Hacker Plunders $450,000 From Defi Protocol Balancer

'Sophisticated' Hacker Plunders $450,000 From Defi Protocol Balancer

In two separate transactions, an attacker targeted two pools containing Ethereum-based tokens with transfer fees – or so-called deflationary tokens.

Lobbyist Abramoff Charged in Cryptocurrency Fraud Case

Lobbyist Abramoff Charged in Cryptocurrency Fraud Case

Jack Abramoff, a once-powerful lobbyist who spent time in federal prison for fraud and corruption, has been charged in a San Francisco court in an investor fraud case involving cryptocurrency and lobbying disclosure, federal authorities announced Thursday.

New Zealand Seizes $90M From Russian Bitcoin Fraud Suspect

New Zealand Seizes $90M From Russian Bitcoin Fraud Suspect

New Zealand police said Monday they have seized $90 million from Alexander Vinnik, a Russian bitcoin fraud suspect who is in French custody but is also wanted in the United States.

Canadian Crypto Firm Collapsed Due to Ponzi Scheme by Late Founder, Regulator Says

Last year’s collapse of Canadian cryptocurrency trading platform Quadriga CX was due to a Ponzi scheme operated by founder Gerald Cotten, who died suddenly in December 2018, the country’s biggest securities regulator said on Thursday.