Today, six incumbent casino operators in Macau signed a productive 10-year gaming contracts with the Macau government and received gaming licenses to operate in the world’s largest gambling city.
Signing by rank:
Six casino operators signed the contract according to their rank in the recent tender process: MGM Grand Paradise, Galaxy Casino, Venetian Macau, Melco Resorts (Macau), Wynn Resorts (Macau) and SJM Resorts.
The representatives of the six casino operators who signed the contracts on behalf of the casinos were:
- For MGM: Pansy Ho, Co-Chairperson and Managing Director of MGM China and Kenneth Fong, President, Strategic and CFO of MGM China; Standing: Other representatives of MGM, the highest placed bidder in the tender process;
- For Galaxy: Lui Che Woo and Francis Lui, Chairman and Vice Chairman of Galaxy Entertainment Group;
- For Venetian: Dr Wilfred Wong, President and Executive Director of Sands China Limited and Dave Sun, Executive Director, Sands China;
- For Melco: Lawrence Ho, Chairman and Chief Executive Officer of Melco Resorts & Entertainment and David Sisk, Chief Operating Officer, Macau Resorts for Melco Resorts & Entertainment;
- For Wynn: Craig Billings, CEO of Wynn Macau; Linda Chen, Vice Chairman, COO and Executive Director of Wynn Macau; and Ian Michael Coughlan, President and Executive Director of Wynn Macau;
- For SJM: Daisy Ho, Chairman and Executive Director of SJM Holdings and Angela Leong, Co-Chairman and Executive Director of SJM Holdings.
On the other side of the table, the Chief Executive of Macau, Ho lat Seng, represented the Macau government and signed on their behalf.
Terms of contract:
Under the terms of the agreements, which will start on January 1st 2023, all six casino operators are to retain a certain capital of MOP$5 billion, up from MOP$200 million in previous agreements.
Each operator must have a “Managing Director”, who must be a Macau resident and must own at least 15% of the company’s share capital.
With this condition, the “Managing Director” has the option to hold 15% as a nominee or under other legal arrangements holding his shares “in name only.”
However, this participation doesn’t have to have the right to vote or any economic interest!
Continued stability for Macau operators:
This contract signing is the culmination of a year of gaming in Macau that has included major changes to Macau’s gaming laws and a serious re-tender process. However, with this official agreements, these six Macau casino operators finally have the stability and all the conditions to operate legally in Macau, especially after investing more than 50 billion dollars in China’s special administrative region over the past 20 years.
At the same time as the contract was signed, it was announced that the total investment of the six operators throughout the tender process was MOP$118.8 billion (US$14.9 billion), with the money going to the developing foreign source markets and non-gaming projects being the MOP$14.9 billion (US$13.6 billion) and money that went to gaming projects was MOP$10.1 billion (US$1.26 billion), which is less than 10% of non-gaming investment and is compatible with the Macau administration’s plans to expand the Macau’s economy.
The six operators’ license applications involve development and implementation plans for the next 10 years, starting from January 1st 2023 to December 31st 2032.
New problem:
Even though the contracts have now been signed and made public, there is still one problem that the operators have to solve before they can officially begin operation.
That problem is the granting of a formal operating license by the Secretary of Economy and Finance, which is predicted to occur in the form of a letter from the Secretary to each of the six operators between now and December 31st.
The letter is required to confirm that all conditions required by the contracts have been fulfilled and to grant special permission to operators to start accepting bets from midnight at the start of Sunday January 1st 2023.
