Inside Asian Gaming

INSIDE ASIAN GAMING | September 2009 18 15 (26) Vincent Tan Chee Yioun Chairman and CEO, Berjaya Group VincentTanmakeshissecondappearance on the Asian Gaming 50 – 2009 list thanks to his gaming and lottery management interests in Malaysia. Mr Tan bears the dubious distinction of being the only Malaysian US dollar billionaire to have dropped out of this unofficial ‘club’ of the super rich in the last year. He has been hit by the triple whammy of the global financial crisis, the accompanying 10% depreciation of the Malaysian ringgit against the US dollar, plus a decline in share prices of his companies. Those setbacks notwithstanding, Mr Tan, a father of 11, is still worth an impressive US$750 million according to Forbes.com ’s activities in Malaysia. BerjayaSportsTotoBerhadisalsoinvolved in the leasing of online lottery equipment. Other activities include manufacturing and distributing computerised lottery systems. Mr Tan got his start as a McDonald’s franchisee, before acquiring a controlling stake in the share capital of Berjaya Kawat Berhad from Australia’s Broken Hill Proprietary (BHP) Ltd and Singapore’s National Iron & Steel Mills. ‘Malaysia’s Richest’ list. His conglomerate, Berjaya Group, reported a RM1.15 billion (US$330 million) profit in 2008. Mr Tan has run Berjaya, which means ‘success’ in Malay, since 1984. The group has diverse interests covering hotels, real estate, finance and retailing (including Malaysia’s first Krispy Kreme doughnut store, which opened in April), and last but not least, lotteries. Berjaya Sports Toto Berhad is Malaysia’s sole national lotto operator with more than 680 outlets throughout the country. It offers a variety of games including digit-type games (namely, 4D, 5D and 6D) and lotto- type games (namely, Toto 6/42 Jackpot, Super Toto 6/49, Mega Toto 6/52) for the domestic market. Since 1969, the company has donated substantial amounts to the promotion and development of sports, youth and cultural 16 (13) Philip Chun Chairman and CEO, Paradise Group widely regarded by industry analysts as likely to set back plans to introduce legal casinos in Japan. That should also give some comfort to the South Korean casino sector, which is dependent on foreign visitors as only one of the country’s 17 casinos is open to locals. The result of the softening won for Korean casino operator Paradise Group was a 14.3% increase in sales in 2008, despite a raft of new venues being opened in the rival casino market of Macau in the second half of 2007, including The Venetian Macao. The operating income for Paradise’s casino operation unit grew 11.9% in 2008, recording 19.2 billionwon (US$15.4million), says the company. The best known and biggest earner among South Korea’s 16 foreigner-only casinos is Paradise Group’s Paradise Walker Hill Casino, which opened in 1968 at the Seoul Sheraton Hotel on Walker Hill. Paradise estimates the foreigner-only casinos in Seoul account for 72% of gross casino gaming revenues in the country. The company says the Korean market overall has grown 57% in three years to record annual gross revenues of 755.5 billion won (US$608.6 million) in 2008. The potential for the market would be much greater if the government were to open the whole market to local players. There is no sign currently that this is on the political agenda. Currently, only Kangwon Land Resort & Casino in Jeongseongun, operated by the property development company of the same name, is open to locals. Paradise Group has long dominated the country’s casino industry, which began in 1968 with the opening of a casino in Incheon, where the international airport serving Seoul is located. The Incheon property was taken over by Paradise in 2001 and renamed the Paradise Golden Gate Casino. The company also owns and operates Paradise Casino Busan and two casinos—Paradise Grand Casino and Lotte Casino—on the resort island of Jeju. Paradise also notably operates the largest casino in Kenya, Africa—the Paradise Safari Park & Casino, which houses 40 tables and 600 machines. In addition to casinos, the Paradise Group runs hotels and restaurants and is involved in manufacturing, duty free retailing, construction, consulting and non- profit activities. Philip Chun effectively took over the reins of the company from his late father, Chun Rak-won, in 2004. Asian Gaming 50 – 2009 The South Korean tourism industry benefited from a weakening of the local currency, the won, following the global financial crisis that escalated in the third quarter of 2008. This attracted more customers from core markets including Japan in late 2008 into 2009. The recent defeat of the ruling Liberal Democrats in Japan’s general election is