Macau Legend Development Ltd. (01680.HK), a satellite casino running on the license of gaming giant SJM Holdings Ltd. (00880.HK), is urging the government to consider the interests of all casino operators amid rumors that it will add one more gaming license to the world’s largest gaming hub.
“Why should all the credit go to the six license holders? The government should consider our contributions as well. So many of us are paying taxes to the government,” said Macau Legend chief executive David Chow Kam-fai.
“The government has to be fair, it should look after the interests of everyone,” he said.
It was reported that the government may issue a seventh gaming license while the current six licenses will expire in 2020 and 2022. Discussions are heating up as the government is set to launch a mid-term review of the gaming industry this year.
Chow said regulators should have a public auction of the gaming licenses and those who have contributed to Macau’s development must be allowed to join the bidding.
Macau Legend wants to have its own license, and so do other casino operators in the territory.
He named several other influential businessmen who are capable of getting the gaming license, including Chan Meng-kam, who owns another satellite casino, the Golden Dragon, under the license of SJM.
Chan is among those who “love China, love Macau”, and is a local delegate to the Chinese People’s Political Consultative Conference, Chow said.
He said Macau Legend, which runs Pharaoh’s Palace Casino and Babylon Casino, has to pay 3 percent of its VIP revenue and 5 percent of its mass market income to SJM.
Given their smaller incomes, satellite casinos cannot match SJM in the amount of bonuses they give their employees, he said, adding that this situation has led to arguments between management and staff.
Macau’s gaming license system is seen as opaque and difficult to understand. The government issued two licenses to US-based Wynn Resorts Ltd. and Hong Kong tycoon Lui Che-woo’s Galaxy Entertainment (00027.HK) in 2002, ending the monopoly enjoyed by gaming mogul Stanley Ho’s SJM for decades.
But the three licenses were split, resulting in three sub-concessionaires. Currently, 18 satellite casinos are running on the license of SJM.
“Why were there concessionaires and then sub-concessionaires? City of Dreams (06228.HK) paid US$900 million to Wynn Macau to get the license. MGM Macau (02282.HK) paid US$250 million to SJM … It’s not fair,” Chow said.
Meanwhile, Macau Legend has been granted 35 gaming tables in Babylon Casino with its launch of the adjacent four-star Harbourview Hotel on Wednesday. The group now has about 185 gaming tables in the city.
It is believed that casinos will be able to better negotiate for more gaming tables if it builds non-gaming facilities, which are in line with the government’s bid to diversify Macau’s economy.
The Harbourview Hotel is part of Macau Legend’s redevelopment project at the non-gaming facility Fisherman’s Wharf. The complex will see two five-star hotels — Legend Palace and Legendale Hotel — opening in 2016 and 2017.
– Contact us at [email protected]