IAG September 2015 - page 11

September2015
inside
asiangaming
11
LimKokThay
ExecutiveChairmanandCEO
GentingBerhad
Genting Berhad is the hub
of the only truly global gaming
company, and Lim Kok Thay sits at its center. Fifty years after his
father, Lim Goh Tong, began building a road through the jungle
to what would become Genting Highlands resort, the group can
celebrate a truly golden anniversary.
From that single monopoly casino in Malaysia—and a vast
web of non-gaming companies from power generation to palm oil
plantations—Genting Group has woven together gaming operations
acrossAsia,NorthAmericaandEurope, increasinglyunder theResorts
World brand, plus a 6.6% stake in Australia’s Echo Entertainment
and a fleet of cruise ships circling the globe. LimKok Thay joined the
company in 1976 and succeeded his father in 2007, just asGenting’s
international expansion shifted into high gear. The one hole in
Genting’snet isMacau, not sucha costlyomissionat themoment.
At year end exchange rates, Genting Group’s 2014 revenue was
$5.8billion,EBITDAwas$1.9billion fromoperation insevencountries,
stockmarket capitalizationexceeded$30billionandGentingBerhad’s
cash hoard stood at $4.68 billion. Those numbers are derived from
assets that include the original resort, now Resorts World Genting;
Singapore’s Resorts World Sentosa, one of the most profitable
integrated resorts in theworld; Genting CasinosUK, among Britain’s
largest operatorswith its42nd casino toopen this year; ResortsWorld
NewYorkCity, thehighest revenue electronic gamingparlor in theUS
Northeast; and Resorts WorldManila, which doubled the Philippine
gamingmarket andopened theway formoreprivatelyowned casinos.
Malaysia-based Genting Berhad holds stakes of 49% to 52% in
the various subsidiaries that control its operating entities, except for
GentingHongKong—GentingMalaysia is selling its 17.81% stake—
which is a 50% partner in Resorts World Manila owner Travellers
International Hotel Group and runs Star Cruises andnewly acquired
Crystal Cruises after selling off Norwegian Cruise Lines for a $1.57
billion gain. Mr Lim chairs each entity, and the Lim family holds
substantial stakes through various private vehicles, most notably
Kien Huat Realty. The structure isn’t made for transparency, and it
can get confusing, as in South Korea, whereGenting Singapore and
GentingHong Kong each had the same partner on different gaming
projects, and in upstate New York, where Genting Malaysia bid
unsuccessfully for a gaming license while Kien Huat was a winner.
What’s clear is thatMr Lim sits at the topof the group.
It’sequally clear that for all itsglobal breadth,GentingGroupstill
leans heavily onMalaysia and Singapore. Last year, 70% of revenue
and88%ofEBITDAcame from those twomarkets.More importantly,
neithermarket looks poised for explosive growth. For the first half of
this year, revenue from leisure and hospitality rose 2% inMalaysia
and fell 20% inSingapore.
Genting is working to shore up those businesses while driving
fiercely to widen its net. In Singapore, it opened a hotel in Jurong
to bring more guests to RW Sentosa, 15 minutes away, a creative
solution to its inability to expand the IR. At RWGenting, it’s in the
midst of a 5-billion-ringgit ($1.2 billion) revamp that includes more
hotel rooms and a new theme park. In January, Genting Singapore
broke ground on the $1.8 billion Resorts World Jeju, on the island
known as Korea’s Hawaii that offers visa free access to mainland
Chinese, whileGentingHongKong sold its shareof a local casino to
RW Jejupartner Landing International. In thePhilippines, RWManila
is completing a $650 million expansion, a prelude to developing
ResortsWorldBayshoreCity in theEntertainment City casino cluster,
both under its Travellers International Hotel Group joint venture
with Philippine billionaire Andrew Tan’s Alliance Global Group. In
the UK, Genting expects to open ResortsWorld Birmingham in the
fourthquarter of this year. Thegroup remains in thehunt for a Japan
license, if casino legalization comes topass.
Thebiggest target isNorthAmerica. InMay,Gentingbrokeground
on the$4billionResortsWorldLasVegas. Itbought the87-acresiteon
thenorth endof theStrip in2013 for $350million fromBoydGaming,
which abandoned constructionof itsEchelonResort in2008.Genting
says it has repurposed 85% of Boyd’s structural work for its project,
expected to open in 2018. The Chinese-themed resort will include a
replica of theGreatWall of China, 3,500 guest rooms in three hotels,
a 175,000 square foot (16,275 square meter) casino, water park,
aquarium, nightclub, 4,000-seat theater, andperhaps evenpandas.
ResortsWorld Bimini in the Bahamas opened the first phase of
whatwillbea300-roomhotel tosupplement itscasino, all supporting
Genting’scruisebusinessoutofMiami, just 50milesaway.But that’s
just a prelude to what Genting hopes will be Resorts WorldMiami
on 30 acres of prime waterfront real estate purchased in 2011 for
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