21 Chen Lip Keong
CEO and Executive Director
Chen Lip Keong founded Cambodia’s NagaCorp in 1995 and as the largest shareholder with an estimated 41.7% of the stock it’s made him a US dollar billionaire. He is not only aggressively building out the company’s vaunted NagaWorld monopoly in Phnom Penh with Naga2—and there’s talk of a Naga3—but he is also taking aim at regional opportunities.
NagaWorld began modestly on a barge in the Mekong River, but everything changed when Dr Chen—a Malaysian citizen who trained as a medical doctor—managed to secure a monopoly on gaming within 200 kilometers of Phnom Penh and won significant tax concessions from the Cambodian government.
It is one thing to negotiate a sweet deal in a developing country and another matter altogether to make sure the deal sticks and the authorities respect and help enforce it, but Dr Chen enjoys the confidence, trust and cooperation of the government, and he’s been able to keep the capital’s lucrative market to himself.
One of the keys has been his determination to keep NagaCorp’s operations well above board, giving the company access to international capital markets—it was the first Cambodian company to list on the Hong Kong Stock Exchange—and he has been scrupulous about keeping investors and analysts informed and maintaining a dialogue with stakeholders. His decision to hire Timothy McNally, a former FBI agent and security consultant, as chairman of the board in 2005 sent a clear message that Naga prioritizes transparency and adherence to corporate governance and anti-money laundering best practices.
NagaWorld, in the meantime, has had great success pursuing an aggressive regional mass-market strategy, bringing players in on charter buses from Vietnam—whose citizens are prohibited from playing in casinos at home—and opening promotional offices in Bangkok and Ho Chi Minh City. At the same time, the company has been honing its VIP strategy, attracting high-end customers who would not qualify as VIPs in Macau and offering far higher junket commissions, made possible by Cambodia’s much lower effective gaming tax rate.
The results have been impressive. Naga has posted a compound annual growth rate for revenue over the past four years of 31% and a CAGR for gross profit of 53%. At the end of 2013, the property had 172 gaming tables and 1,543 electronic gaming machines. It also had a 700-room hotel and 25,000 square meters of meeting and other public spaces.
Dr Chen and his team are now working to extend that growth into the future, and they are doing so while facing headwinds. In 2013, the company was beset by strikes as workers demanded better pay; staffing costs increased considerably in 2013 over 2012. Meanwhile, political instability in Cambodia around the time of the 2013 elections cast a shadow over the country’s fast-growing tourism sector, and a 6.4% drop in NagaWorld’s H1 2014 mass-market revenue contributed to the stock’s fall from recent highs.
Still, analysts remain positive, and largely because of Dr Chen’s grand plans for the future. Naga2, which should be completed by 2016, will feature 1,000 new hotel rooms and 50 VIP suites. The company is also expected to launch direct air charters to and from China later this year on two A320 jets, and the hope is this will increase VIP traffic.
Dr Chen is now starting to explore other frontier markets. NagaCorp has formed Naga Russia, which is developing a 1,000-room casino with 100 table games near Vladivostok. Opening is scheduled for 2018.
22 Enrique Razon Jr
Chairman and CEO
Philippine ports tycoon Enrique Razon’s first venture into gaming, Manila’s Solaire Resort & Casino, posted second-quarter net profit equivalent to US$19.4 million, 36 times greater than last year’s first full quarter of operations, on EBITDA that nearly quadrupled to $103.5 million. Gaming revenue rose 56% to $118.3 million, driven by strong growth in VIP turnover, most of it from overseas players, with junkets accounting for about 80% of VIP play.
“Strategic management decisions and focus on goals have borne better-than-expected results,” said Mr Razon, chairman and CEO of Solaire parent, PSX-listed Bloomberry Resorts.
The biggest change since a year ago was the termination of the contract of William Weidner’s Global Gaming Asset Management, which had been hired to open and run Solaire and owns a disputed 8.7% of Bloomberry. GGAM’s presence helped Bloomberry’s Manila IPO succeed, providing $1.2 billion in funding for the resort, a quantum leap beyond anything found in the Philippine gaming market. But Mr Razon charges the firm took its eye off the ball after Solaire opened.
“He is very hands-on with his property, very concerned about it. It’s very personal to him, and he expects everyone else to be that way,” says a gaming executive who has worked with him.
The two sides are in arbitration in Singapore over the termination. A Philippine court, in the meantime, has enjoined GGAM from consummating a US$166 million deal to sell its Bloomberry stake, acquired last year for $15 million, until the arbitration is settled.
Mr Razon has since brought in Thomas Arasi as president and chief operating officer. Industry observers say the former CEO of Marina Bay Sands and longtime hospitality executive was a brilliant
hire, and insiders praise him for rationalizing costs, now expanding at a slower rate than revenues, although gaming revenue is still running second to crosstown rival Resorts World Manila.
Mr Razon isn’t in gaming to finish second. In November, Solaire is slated to unveil its Phase 1A expansion, which includes a 312-key all-suite hotel pitched to premium players, a luxury shopping mall and a 1,700-seat Broadway-style theater. Solaire also is counting on a major traffic boost from the opening next door of Melco Crown’s City of Dreams Manila later this year. It will be the second IR at the government-sponsored Entertainment City resort district on Manila Bay where Solaire has stood isolated since its debut last March.
Mr Razon also is looking to branch out from Manila into other gaming markets. He’s eyeing Latin America, where his family business operates a number of port facilities and he understands the business climate. Bloomberry also is looking closer to home. In May, Mr Arasi wowed a Tokyo conference on Japan’s pending casino legalization, giving a presentation in Japanese and English.
An executive who attended says of Bloomberry, “They have a good chance in Okinawa,” where, not coincidentally, Mr Razon’s company runs the port.
23 Rowen Craigie
Management Director and CEO
Rowen Craigie’s solid managerial skills are being tested in Australia as never before in an operating environment characterized by weak domestic demand and increasing competition both regionally and at home for the high rollers that have been a mainstay of the success of Crown Resort’s flagship, Crown Melbourne.
He hasn’t downplayed the challenges either. Crown Resorts posted a 35% increase in fiscal year 2014 profit to A$646 million, but top-line performance was soft—normalized revenue was down 0.7% at Crown Melbourne, down 3% at Crown Perth—and citing the 2% growth in main-floor gaming revenue at Crown Melbourne as indicative of the challenges, he said frankly, “That’s not where we want to be.” It was strength in Melbourne’s vaunted high-end business, combined with the company’s 34% stake in Macau’s Melco Crown Entertainment, that carried the company for the year, with MCE the “main contributor,” Mr Craigie said. Crown’s MCE stake earned it a $291.2 million equity-accounted share of profit, up 91% on last year, while VIP turnover rebounded at home, up a combined 36.5% in the second half, following a drop of 25.8% in the first half.
“The higher-end [customer] is travelling a bit better than the lower end,” Mr Craigie said when the results were announced last month. “The challenge remains to get the players to Australia, and to do that they’re overflying effectively Macau, Singapore. They’re turning down Vegas to get to Australia.
“But the first challenge,” he added, “is how do you get them to fly to the most distant market where they’re all playing the same game, which is high-stakes baccarat.”
The completion last year of a 15-month refurbishment of Crown Melbourne should help, as will a $645 remodeling and expansion of Crown Perth, which will continue into 2016 with the addition of 500 more hotel rooms. The company also has upgraded its existing fleet of Gulfstream jets with three super-luxury Bombardier Global Express XRS aircraft at a cost of US$100 million.
It helps, too, if you’ve been around for every twist and turn in the industry’s fortunes in Australia for the last quarter-century, and Mr Craigie has. He joined the Packer family’s casino business, then known as Crown Melbourne Limited, in 1993 as general manager of machine games, coming off a three-year stint as group general manager for gaming for the state of Victoria’s TA B. In 2001, he joined Crown Melbourne’s board of directors and the following year was named chief executive of Crown Melbourne and Crown Perth’s predecessor, Burswood Limited. He also served on the board of Consolidated Media Holdings, the television and newspaper company on which the Packer fortune was built. Since the present-day Crown’s formation in 2007, he has been the only CEO the company has had.
As James Packer’s right-hand man he’s recently been logging some air miles as well, flying back and forth to Sri Lanka to try to nail down a US$350 million resort casino in Colombo and wooing state and local leaders in Queensland on behalf of Crown’s pitch for a A$1 billion destination resort in the capital of Brisbane. He’ll be spending a lot of time in New South Wales as well to bring the company’s A$1.3 billion luxury Crown Sydney to fruition on Darling Harbour.
The allure of all these projects is Crown’s reputation as Australia’s leader in the international VIP segment, a business Mr Craigie has been instrumental in building and maintaining; and on that score it’s a sure bet that Mr Packer’s pursuit of a multibillion-dollar resort in Las Vegas, where the company recently purchased a majority stake in 34 prime Strip acres, will be shaped to a significant degree by his experience and advice.
24 Philip Chun
Chairman and CEO
Big changes are coming to South Korea’s foreigner-only casino landscape. Rather than fight them, market leader Paradise Group under Phil-lip Chun has embraced them.
As the Korean government loosens regulations to encourage casino development as a tool for economic growth through tourism, Paradise has gotten out in front. It’s teamed with Japanese gaming machine manufacturer Sega Sammy Holdings to build Korea’s first integrated resort in a special economic development district in Incheon, 40 kilometers from Seoul, adjacent to the nation’s main international gateway airport.
Groundbreaking on the US$1.7 billion Paradise City is set for next month, with an early 2017 opening projected. Paradise holds 55% of the joint venture, which owns the existing Paradise Casino Incheon, the property that is providing the gaming license. In July, Paradise sold $280 million in additional shares on the Korea market to help finance the project.
The resort’s $1 billion first phase will include hotels, a convention center, shopping and entertainment, in addition to a casino with 120 live table games, 400 slot machines and 300 electronic gaming tables.
It will have plenty of company too. A partnership led by Caesars Entertainment has been approved to build a second IR in Incheon, expected to open in 2018. Dream Island, a $2 billion tourism project in Incheon backed by the Ministry of Oceans and Fisheries along with overseas Korean investors, may also apply for a casino license.
While at the other end of the country, Genting Singapore has joined a partnership to build an IR on the resort island of Jeju, priced at $2.2 billion at full build-out. Paradise says it also plans an IR in Jeju, where it currently has two casinos.
Paradise is confident Paradise City will stand out among the crowd. “Paradise will differentiate from new foreign players with ‘Korean-ness,’” Mr Chun says, expecting to capitalize on hallyu, the Korean pop culture trend sweeping Asia. “The main content Paradise will be showing to our guests will be Korean culture such as K-pop and other entertainment content.”
The key, though, will be its proximity to China. “We strongly believe that new supply will bring attention and create new demand from China, especially northeastern China,” he says. The resort will benefit as well from a direct connection by monorail to Incheon International Airport.
There are skeptics, such as Kore Managing Director Steve Park, a Seoul gaming consultant, who contends Korea’s proposed IRs are too small to make waves internationally. Standard Chartered analyst Philip Tulk is more bullish. He believes IRs in Incheon will produce a cluster attractive to foreign visitors, a business already well-known
to Paradise, which gets the lion’s share of Korea’s foreign VIP trade. The company has a long history in that business, dating back to its founding in 1965 by Mr Chun’s father. Mr Chun took over the top job in 2005.
But Paradise pays for its VIP lead and the outer Seoul location of its flagship Walker Hill casino with generous comps, about 20% of sales, according to Mr Tulk, who rates Paradise his top Korean gaming pick. Comp spending depresses Paradise’s operating margins, which usually run 10 percentage points below those of its main rival, Grand Korea Leisure.
Paradise’s five casinos, in Seoul, Incheon, Busan and the two in Jeju, achieved a 54.8% market share in the second quarter with gaming revenue of 149 billion won ($146.5 million), up 16.4% from a year earlier, on drop that rose 16.4%. Chinese VIPs accounted for 66.1% of the drop. However, profits fell 35.1% to KW26 billion. Walker Hill accounts for around 60% of gaming revenue, but the Paradise Sega Sammy subsidiary at Incheon shows the best operating margins, a promising sign for Paradise City.
25 Hajime Satomi
Chairman, President and CEO
Sega Sammy Holdings
As Japan’s push to legalize casinos inches closer to realization, SEGA SAMMY HOLDINGS is positioning itself as a frontrunner to secure one of the gaming licenses that could soon be on offer.
In a bid to cut its teeth in casino resort development and operation, the Japanese pachinko manufacturing giant will break ground next month on the first phase of a highly touted destination resort with gaming it is developing in South Korea with that country’s Paradise Group on Yeongjong Island, a special economic zone located near the port city of Incheon and the country’s main international airport.
A 2017 opening is planned for the US$1.7 billion Paradise City, as it’s known, and plans are to capitalize on China’s booming market in outbound tourism with a hotel, a casino with 120 table games and 700 slots and electronic gaming machines and an array of nongaming attractions, including retail shopping, entertainment and MICE facilities.
SEGA SAMMY stated a desire as far back as 2007 to invest in casinos in Japan should the opportunity arise, and in 2012 purchased a resort in Miyazaki Prefecture. Two months after that acquisition was announced, Chairman Hajime Satomi reasserted the company’s intentions, saying, “Of course, [a casino] is what we have in mind.” SEGA SAMMY expects to generate 157 billion yen (US$1.5 billion) in total revenue in the six months ending 30th September. Although it already ranks as one of Japan’s biggest companies based on recurring income, a casino license would propel it much higher.
SEGA SAMMY was created in 2004 when Sammy Corporation bought a controlling interest in ailing video game giant Sega. The 72-year-old Mr Satomi, who heads the combined group, founded Sammy in 1975 and built it into one of the biggest suppliers of pachinko and pachislot machines in Japan (its major rival in the market is Sankyo Corporation). In the current fiscal year ending 31st March 2015, Sammy expects to sell 250,000 pachinko machines and 374,000 pachislots. The company is also developing innovative games for the casino industry through its subsidiary SEGA SAMMY CREAT ION. The first of these—splashy, outsized, carnival-style takes on baccarat, sic bo and big wheel—were unveiled in May at the G2E Asia expo in Macau.
26 Dhammika Perera
Chairman and Managing Director
The government of Sri Lanka wants tourism to become the island nation’s primary generator of foreign exchange earnings over the next three years and is manoeuvring resort casinos into the mainstream of that push.
Tourist arrivals surged 46% in 2010, the first full year of peace following the defeat of an armed revolt by the island’s ethnic Tamils that had battered the country for a generation. Arrivals last year were up 26.7% to 1.27 million. And the government has given the green light to three casino resort projects: the US$350 million Crown Colombo spearheaded by James Packer and local partner Ravi Wijeratne; an $850 million resort by Sri Lanka’s largest publicly traded company, John Keells Holdings; and the $350 million Queensbury proposed by Vallibel One, owned by one of Sri Lanka’s richest men—perhaps the richest—Dhammika Perera. The future of Crown’s project now looks uncertain, but Mr Perera is already the biggest casino operator in the country and looks set to push ahead with Queensbury.
The handful of small casinos currently catering to the Colombo tourist trade operated for years as “recreation clubs” before their existence was formally recognized by legislation passed in November 2010. Mr Perera owns three of the four that are officially sanctioned—the ones registered with the country’s Inland Revenue Department to pay gaming levies. All are located in Colombo, and the biggest, Bally’s, has 80 table games (his Bellagio has 40 and his MGM Colombo another 40). Following the transfer of their de facto licenses to larger properties, including the 40-story, 500-room Queensbury, they will be gradually phased out.
Mr Perera is gifted with a keen ability to analyze investments. According to a recent profile in Forbes, “Using mathematical models that he’s developed over the years, he’s a numbers guy who hunts for undervalued assets and then swoops in. Once he has the right managers in place, he gives them free rein.”
Back in 1999, Mr Perera developed a 20-year plan to become the country’s leader in each of 12 sectors—tourism among them—by 2019. The 46-year-old tycoon’s empire now boasts 23 listed companies that account for 8% of all companies traded on the Colombo Stock Exchange and dozens of private ones. His reach extends to Thailand, Indonesia, Japan, the UK and elsewhere, and his companies employ some 62,000 people. In anticipation of the end of the civil war, he began investing in the tourism sector in 2000 and now has a number of luxury resorts and hotels with 600 rooms in total and another 1,200 under development.
Sri Lanka’s proximity to India bodes well for Mr Perera’s Queensbury, offering easy access to the subcontinent’s increasingly affluent and gambling-hungry millions. According to Manav Thadani, who heads the Indian office of hospitality consulting firm HVS, “Right now, if you look at the tourist arrivals into Sri Lanka, Indians
dominate that, and the thought process is that that number could go up significantly if they had casinos because casinos are something which currently are prohibited in India.”
The upcoming resorts could also help boost tourism, particularly at the high end, simply by addressing the country’s shortage of quality tourist accommodation.
Perennially rated one of the world’s top destinations by the likes of Lonely Planet, Conde Nast and The New York Times, the “Pearl of the Indian Ocean,” as Sri Lanka is known, offers no end of delights for the traveler—beaches, tropical forests, lush highland valleys, waterfalls, botanical gardens, sprawling tea plantations, centuries-old temples, ornate colonial-era landmarks, 15 national parks in all, eight UNESCO World Heritage sites, even wild elephants—but what it doesn’t have is anywhere near enough tourist-caliber hotel rooms to accommodate the government’s target of 2.5 million visitor arrivals by 2016.
27 Matt Bekier
CEO and Managing Director
“A safe pair of hands”—that’s how the head of equities for Echo Entertainment’s largest investor, Sydney-based Perpetual Limited, characterized Matt Bekier when he took the helm as ASX-listed Echo’s chief executive in April.
Certainly Mr Bekier hinted as much after taking over from Las Vegas industry veteran John Redmond, who resigned in January. ‘’Ninety-five percent of the direction that we have set out with John will be the same,” said the long-time Tabcorp CFO, who moved to Echo as CFO when Tabcorp spun it off in 2011.
But then quite a lot changed. In June, Echo trumped rival Crown Resorts in Brisbane by teaming up with Hong Kong giants Chow Tai Fook Enterprises and Far East Consortium on a joint A$1 billion resort casino bid in the Queensland capital. With a single shot Echo had pared the short list of bidders from four to three and presented Crown with a formidable alliance in the process. Chow Tai Fook’s extensive holdings in property, hospitality and consumer goods include the largest jewelry retailer in the world. Far East owns 25 hotels around the world and has been a significant presence in Australia for years and currently is building a A$1 billion residential and retail complex in Melbourne. The move forced Crown to partner up with China state-owned property developer Greenland, thus reducing the short list to two.
Brisbane, where Echo’s standing as sole casino operator has been under a concerted Crown assault for a couple of years, is likely to prove key to Mr Bekier’s ability to survive in the job longer than either of his American predecessors. There was Larry Mullin—who came in with Mr Bekier in the Tabcorp demerger and had the thankless job of overseeing an $870 million remodeling of The Star, Echo’s Sydney flagship, while fending off a takeover bid by James Packer that resulted in the ouster of Echo’s chairman—and his successor, Mr Redmond, who joined when Echo was already being outmuscled by Mr Packer on its home turf and who failed to prevent Crown from winning a bid to develop a competing luxury resort on Darling Harbour.
Mr Bekier reportedly clashed with Mr Mullin and was said to have been in line for the CEO’s job before the board decided on Mr Redmond. The association with Mr Redmond was productive nonetheless and his extensive experience served Mr Redmond well. He oversaw Tabcorp’s finances for five years and prior to that was a longtime principal at McKinsey & Co., the famed New York City-based management consultants. He holds a doctorate from Switzerland’s Universität St. Gallen, a hothouse for the development of leaders in business, investment banking and finance. Together with Mr Redmond he crafted some $30 million in cost cuts that have helped shore up Echo’s profitability in a domestic market plagued by a sagging consumer spend. In July he closed on Mr Redmond’s negotiated sale of the Jupiters Townsville in Queensland for $70 million and is focusing on remaking the company’s more lucrative Jupiters Gold Coast, which is slated for an expansion and improvements priced at $300 million.
In the meantime, Echo has been more than holding its own. Net profit adjusted for fluctuations in VIP hold totaled $158.2 million, beating the company’s earlier guidance by $5 million-$8 million. Combined revenues from The Star and the three Queensland casinos beat a consensus of analysts polled by Bloomberg to total $1.97 billion on a normalized basis, an increase year on year of 3.8%.
As Citi analyst Michael Goltsman told the Sydney Morning Herald, it was “hard to fault the result”.
The beat, he said, “reflected very strong cost discipline and revealed very strong underlying momentum in gaming revenues”.
28 Clarence Chung
Chairman and President
Melco Crown Philippines
Chairman and CEO
Entertainment Gaming Asia
An accountant by training, Clarence Chung has emerged as Lawrence Ho’s point man in Southeast Asia. Mr Chung serves as chairman and president of Melco Crown Philippines, responsible for the City of Dreams Manila integrated resort due to open within weeks. Mr Chung is also a non-executive director of parent company Melco Crown Entertainment and an executive director of Mr Ho’s half of that partnership, Melco International Development.
He joined Melco in 2003 as chief financial officer after stints as an investment banker and vice president of Pacific Century Group, the business group founded by Richard Li, like Mr Ho, the son of an iconic Hong Kong billionaire (Li Ka Shing) not anointed as his father’s successor. Mr Chung is also chairman and CEO of Nasdaqlisted Entertainment Gaming Asia, which is 38% owned by Melco International Development and runs slot operations in Cambodia and the Philippines and manufactures casino currency.
City of Dreams Manila could make or break Entertainment City, the cluster of four integrated resorts that Philippine authorities hope will move the country into the top rank of international gaming destinations. The resort will have 900 guest rooms, including a Crown Towers, a Hyatt and Asia’s first Nobu Hotel, a star-studded enterprise headlined by celebrity chef Nobu Matshuhisa that includes actor Robert DeNiro.
Melco Crown says it made the call to take a leading role in the Manila resort from Belle Corporation, controlled by the Philippines’ richest family, the Sys, and rebrand it as City of Dreams Manila when regulator PAGCOR revised its formula for gaming devices based on not just the quantity but the quality of rooms. The new formula upped the resort’s allowable gaming tables by 50% from 242 to 365 and more than doubled the number of machines to 1,680 slots and 1,680 electronic table game seats. “The meaningful increase in allowable gaming positions at City of Dreams Manila supports the brand mission and vision of delivering a superior and premium product to the Philippines entertainment and gaming market,” Mr Chung said when the changes were announced last October.
To support the increased gaming capacity, City of Dreams Manila has experienced gaming hand Kevin Sim in place as chief operating officer. Mr Sim, an accountant like Mr Chung, joined the company after running operations at Malaysia’s Genting Highlands Resort (now Resorts World Genting) as executive vice president, following stints as the property’s senior vice president of casino operations and vice president of slots, plus finance roles there and with NagaCorp in Cambodia.
The expertise is welcome given Mr Chung’s gaming operations record. As CEO of Entertainment Gaming Asia he presided over the 2012 opening of Dreamworld Pailin on Cambodia’s border with Thailand, the write-down of the casino’s entire US$2.5 million cost last December and its sale for $500,000 in June. The company, formerly known as Elixir Gaming Technologies and traded under the symbol EGT, also runs Cambodia’s Dreamworld Poipet, a slots-only operation on the Thai border, opened in May 2013, and operates slots in other casinos in Cambodia and the Philippines.
Second-quarter revenue from EGT’s slot operation fell 12% to US$4.4 million, and it may go lower, since the contract with its biggest client, NagaCorp’s NagaWorld in Phnom Penh, expires next year. NagaWorld has installed other machines and reportedly was not pleased when EGT decided to start its own Cambodia operations. Excluding a $239,000 loss from the discontinued Pailin operation, EGT reported a net income of $217,000, hit by bad luck in the form of big jackpot payouts, according to Mr Chung.
He may be victimized by more bad luck. Along with Crown Resorts CEO Rowen Craigie, Mr Chung is a director of MCE International, the Melco Crown entity at the center of money-laundering allegations in Taiwan.
29 Winfried Engelbrecht-Bresges
Chief Executive Officer
Hong Kong Jockey Club
The start of the Lunar New Year in February ushered in the “Year of the Horse” in the traditional Chinese calendar, and it proved prophetic for the venerable Hong Kong Jockey Club, which has just come off its best season ever, posting record handle of HK$101.83 billion (US$13 billion), an increase of 8.5% over 2012-13.
The “most remarkable and notable season in our 130-year history” is how Chief Executive Winfried Engelbrecht-Bresges described the nine months of racing that ended 6th July and saw attendance at the club’s courses at Sha Tin and Happy Valley exceed 2 million for the second consecutive year.
The season also was the first to feature co-mingled wagering in the United States. Hong Kong pools are the largest in the world. While its horse races are the HKJC’s most visible activity and its biggest earner, it also holds the monopoly on running the Mark Six lottery and offering fixed odds betting on overseas football matches in the city.
Mr Engelbrecht-Bresges is the man who’s ignited HKJC’s fortunes, elevating the quality of competition to world-class standards and spearheading a reinvestment strategy that has seen the club spend upwards of HK$3 billion to upgrade its facilities over the last few years as it energetically pursues younger audiences with new restaurants, live music, themed party nights and wine-tasting events. To draw more mainland Chinese the club also has added a betting venue in Beijing.
Considering that the HKJC is Hong Kong’s largest taxpayer, as well as the largest private donor to charity in the city, contributing an average of over HK$1 billion a year, his impact is significant, and the gratitude of his adopted city has been expressed in a seat on the board of directors of the Community Chest of Hong Kong and an appointment in 2009 as a justice of the peace.
A former professional footballer, Mr Engelbrecht-Bresges joined the club in 1998 as director of Racing after serving six years as CEO
of the governing body of German horseracing and breeding. He was promoted to executive director, Racing, in 2000 and has served as CEO since the start of the 2007 season, when he brought in William Nader, who headed the New York Racing Association, to ably take over the executive director’s responsibilities. He also serves as vice chairman of the Asian Racing Federation, whose members include 20 of the sport’s governing bodies in the region, and is vice chairman of the International Federation of Horseracing Authorities.
30 David Chow
CO-Chairman and CEO
Macau Legend Development
The opening of a new hotel later this year at Macau Fisherman’s Wharf could kick off the revival of the moribund theme park that sits beside the city’s main ferry terminal on the Outer Harbour.
The theme park, which includes the Babylon Casino, was opened by local entrepreneur David Chow in partnership with Macau casino mogul Stanley Ho at the end of 2005. Its replica Tang Dynasty palace and erupting volcano failed to impress mainland Chinese visitors and have since been demolished to make way for a much-needed revamp, budgeted at HK$6 billion (US$770 million). To raise the necessary funds, Mr Chow floated a chunk of his Macau Legend Development on the Hong Kong stock market, but due to lukewarm investor interest, only collected US$238 million from the exercise. Mr Chow met the shortfall by securing an additional HK$4.2 billion (US$541.9 billion) in bank loans this year.
The revamp, divided into three phases, will add three new hotels with more than 1,200 rooms (the property currently has only a single 72-room hotel), a pier, a dinosaur museum and 350 more gaming tables. Some analysts have cautioned that it could fail to get all the expected tables owing to the government’s cap on the market-wide growth in the number of tables of 3% per annum. But the first hotel is on track to open in the fourth quarter of this year, with the entire revamp slated for completion in 2017.
Mr Chow has been involved in Macau’s gaming industry for four decades, first as a junket representative, then as a casino developer and operator. The 63-year-old investor, husbandman, high-stakes gambler, junketeer, honorary consul (Cape Verde) and all-around mover and shaker, a former member of the Macau Legislative Assembly and a longtime protégé of Stanley Ho’s, believes he still has a thing or two to teach the “new entries,” as he derides his Las Vegas-style competition on Cotai.
Macau Legend Development, which in addition to Macau Fisherman’s Wharf and Babylon Casino also operates the Pharaoh’s Palace Casino located nearby at the company’s Landmark Macau hotel, reported a 5.1% year-on-year increase in gaming revenue in the first half of this year to HK$654.9 million, though profit was down 15.1% to HK$226.4 million, largely attributable to depreciation of the company’s yuan-denominated investments.
In an effort to boost the mass-market appeal of its gaming properties, the company purchased a casino management system from Bally Technologies in July. But the mission to draw mass-market players to Fisherman’s Wharf with pachinko-style slot machines supplied by Japan’s Dynam Holdings appears to have stalled. More than 100 units were to have been set up at the theme park this year, but Macau Legend announced last month that the installations would likely be delayed.
Earlier this year, Mr Chow secured a HK$680 million loan to fund a “Portuguese”-themed retail and entertainment complex he has conceived for Hengqin, a mainland Chinese island that sits adjacent to Macau and has been earmarked for development by Macau enterprises in order to support the diversification of the city’s economy. Hengqin’s land area is three times that of Macau, and its population is expected to grow from a mere 7,000 last year to 280,000 by 2020 as it proceeds to develop as an effective nongaming annex to Macau.