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Saturday, January 28, 2023

Macau begins open betting consultation before casino re-bids

The Hong Kong-Macau government will begin a 45-day public gaming consultation on Wednesday as it attempts to assess public consensus before a closely-watched re-tender for its multi-billion-dollar casino next year.

Lei Weinong, secretary of the economy and finance of the world’s largest gambling center, said that due to some deficiencies in industry regulation, the government will further promote the “sustained and healthy development” of Macau’s gambling industry.

At a press conference on Tuesday, Lei detailed nine aspects of the consultation, including the number of permits to be issued, strengthening supervision and protection of employee benefits, and introducing government representatives to supervise the daily operations of the casino.

As a special administrative region of China, Macau has strengthened its censorship of casinos in recent years. The authorities have severely cracked down on illegal capital flows from mainland China and targeted underground lending and illegal cash transfers.

Beijing has also intensified the war on the cross-border flow of gambling funds, affecting the financing channels of Macau intermediaries and their VIP casino customers.

In June of this year, the number of gaming inspectors in Macau more than doubled and several departments were reorganized to strengthen supervision.

Macau casino operators Sands China, Wynn Macau, Galaxy Entertainment, SJM Holdings, Melco Crown Entertainment and MGM China must re-bid their casino licenses when they expire in June 2022.

DS Kim, an analyst at JPMorgan Chase in Hong Kong, said that due to stricter review of capital management and daily operations before the license renewal, the ratings of all Macau gaming companies were downgraded from “overweight” to “neutral” or “neutral” after the briefing. Reduce holdings”.

“We acknowledge that this is only a’directional’ signal, and the actual level of supervision/enforcement is still controversial,” he said, adding that the announcement has planted the seeds of suspicion in investors’ hearts.

George Choi, an analyst at Citigroup in Hong Kong, said that although the public consultation documents provide limited details, the proposed amendments can promote the long-term sustainable growth of the industry and “have a positive impact on six casino operators.”

However, he warned, “Given the downturn in investor sentiment, we would not be surprised if the market only focuses on potential negative effects.”

Shares of US casinos operating in Macau fell sharply on Tuesday, while Las Vegas Sands and Wynn Resorts fell more than 12% due to concerns about regulatory tightening.

World Nation News Desk
World Nation News Deskhttps://worldnationnews.com/
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