Chief Financial Officer of MGM Resorts International, Jonathan Halkyard, has told investors the company is confident it will be successful in its bids to win a new 10-year gaming concession in Macau and to develop an integrated resort in Osaka, Japan.
Speaking at the Deutsche Bank Leveraged Finance Conference on Wednesday (Asia time), at which he outlined the company’s financial position and group strategies going forward, Halkyard noted that MGM was currently in a holding pattern in Asia as it awaits news on those two key bids.
They include the re-tender process in Macau, with MGM China one of seven companies to have submitted a bid last week for the award of up to six concessions before the current concessions expire on 31 December 2022.
“We worked very hard on our application for the re-tendering,” he explained.
“We submitted that a week ago. We had oral presentations this past weekend which I’m told went quite well from our perspective. We understand that this process is going to continue for the next three months and a decision will be made by the end of the year so that’s the timeline we’re working on.”
“How that timeline works in terms of individual milestones and back and forth is to be determined, but there is no greater priority for our MGM China management team right now and for MGM Resorts as majority shareholder than seeing us through to a successful conclusion.”
MGM is also awaiting news from the central government of Japan on whether its submission to develop a US$9 billion integrated resort in Osaka has been successful. MGM and its local partner ORIX Corp were confirmed by Osaka city and prefecture as preferred partner for the IR bid in September 2021 and submitted their bid in April of this year.
“The Osaka integrated resort, this is an investment we will be making presuming we are awarded a license in Japan,” Halkyard said.
“It is an integrated resort that we think will be a fantastic property, certainly down the road, but we are very optimistic about our ability to proceed with that.”
Despite the company’s ongoing Macau woes, which saw MGM China report a US$306 million loss in the six months to 30 June 2022, Halkyard told investors on Wednesday that MGM Resorts has never been better placed financially – buoyed by the recent sale of Las Vegas real estate assets and booming business levels across the United States.
“MGM’s liquidity position has never been stronger,” he said. “Rolling forward and taking into account retiring our notes next March, we will have more than US$4 billion in cash on the balance sheets and almost US$6 billion in total liquidity.”