Date
17 October 2017
SJM's Lisboa Palace project is expected to be completed by 2017. Photo: Bloomberg
SJM's Lisboa Palace project is expected to be completed by 2017. Photo: Bloomberg

The Big Picture: NEW COTAI GROUND

The ground is shifting for Macau casino empire SJM Holdings Ltd. (00880.HK). The company has revised up the cost estimates for its new integrated Cotai resort, SJM’s first foothold in the area.

Breaking ground on the company’s Lisboa Palace resort, chief executive officer Ambrose So said Thursday that stronger commodity prices and rising wages meant the budget for the project was now HK$30 billion (US$3.85 billion), up from the HK$25 billion price tag SJM put on it last year.

But So said the added costs did not mean the company has any financing needs, suggesting that SJM may not have to raise fresh capital.

So also said he wants the Macau government to let casino operators hire non-locals as dealers given the labor shortages in the administrative region.

SJM is the last of Macau’s six gaming license holders to embark on a gaming and resort project in Cotai, and the Lisboa Palace is expected to be completed by 2017. In May 2012, Wynn Macau, Ltd. (01128.HK), a unit of Nasdaq-listed Wynn Resorts, started work on its US$4 billion Cotai project, which is will be up and running in the first half of 2016.

Just under a year later, MGM China Holdings Ltd. (02282.HK) turned the first sod on its Cotai project. It’s tipped to cost about HK$20 billion and start operation in the first half of 2016. Pansy Ho Chiu-king, the daughter of SJM’s Stanley Ho, has a 27.4 percent stake in the company.

The three other license holders — Melco International Development Ltd. (00200.HK), Galaxy Entertainment Group Ltd. (00027.HK) and Sands China Ltd. (01928.HK) — launched Cotai projects some years ago. All the six license holders are expected to benefit from the opening of the Hong Kong-Zhuhai-Macau Bridge in 2016, observers said.

IPO bids stalled as regulators seek more documents, paper says

Hundreds of firms seeking to launch initial public offerings will have to submit additional documents and wait until late March before regulators start reviewing their applications, the China Securities Journal reported Friday, citing unidentified sources. At least 98 firms have filed their IPO applications with the Shanghai stock exchange and another 116 on the Shenzhen bourse, but regulators sought additional documents, including annual reports, IPO commitment letters from controlling shareholders, board directors and top corporate officials, as well as plans on how to stabilize share prices after listing, the report said.

CAAM opposes foreign control of car ventures, paper says

The China Association of Automobile Manufacturers (CAAM) renewed its opposition to bids by foreign carmakers to own more than a 50 percent stake in joint ventures in the country, the China Securities Journal reported Friday, citing the group’s secretary-general, Dong Yang. China’s auto industry is not an ordinary manufacturing business but a major force in the transformation and upgrade of the economy, Dong said, adding that the domestic carmakers would end up becoming mere processors for foreign brands if they gave up their controlling power over the sector’s development. Analysts say Dong’s remarks were meant to cool down expectations that the government may revise rules to ease market access for some foreign new-energy car manufacturers, including US electric-car maker Tesla Motors Inc., the report said.

– Contact HKEJ at [email protected]

JP/SK

 

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