Genting Singapore, operator of Singapore’s Resorts World Sentosa, has revealed a maximum budget of US$10 billion for development of an integrated resort in Japan.
The figure formed part of a circular to shareholders issued on Monday ahead of an extraordinary general meeting the company plans to hold on 4 February 2020 in order to gain shareholder approval to proceed with “one or more bids” for the development, operation, management and ownership of an IR project in Japan.
In announcing the EGM, Genting Singapore explained it is seeking shareholder approval to undertake its Japan IR project on “such terms and conditions as the Directors deem fit” and to allow the Directors authorization to “do all such things and execute all documents as they may consider necessary or expedient to give effect to the Proposed Bid and the Company’s investment in the Japan IR project.”
Such bids, the company confirmed, will be focused on major cities and prefectures with Osaka, Yokohama and Tokyo named as its primary locations of interest.
However, any investment in Japan would not top US$10 billion with Genting Singapore stating it is “cognisant that, for the purposes of good corporate governance, such approval of shareholders should not be for an ‘un-capped’ amount.
“Hence, the Company is seeking the approval of Shareholders to submit a Proposed Bid with respect to any one prefecture or city with an investment amount not exceeding US$10 billion (approximately SG$13.6 billion),” it said.
Genting Singapore added that, while it may submit multiple IR bids in Japan, it will not develop and operate more than one IR in Japan in the first seven years after receiving approval by the Minister of Land, Infrastructure, Transport and Tourism for its first IR.
Outlining its reasons for pursuing a Japan IR license, Genting Singapore said, “The Group’s strong financial position puts it in an exceptional position to develop a truly transformational project in Japan. The Japan IR investment will enable the Group to optimize its balance sheet and create attractive and sustainable returns to Shareholders in the medium and longer term, as it did with the Singapore IR (Resorts World Sentosa).
“The Company expects the return of the Japan IR project to be commensurate with market expectations and conditions of similar projects in the leisure, hospitality and gaming industry.”
Genting Singapore noted that full implementation of a Japan IR bid would remain dependent on factors such as confirmation of relevant IR laws and regulations as well as final development, pre-opening and construction costs.
The planned 4 February EGM will also see shareholders vote on a potential incentive award to be granted to Chairman Lim Kok Thay “for his contributions and involvement in the Proposed Bid by way of awards of Shares,” dependent upon the Japan IR bid proving successful.