Inside Asian Gaming

July 2010 | INSIDE ASIAN GAMING 45 Briefs Michael Hu, Regional Sales Manager, Interblock Asia Pacific, commented: “Club 21 did try a croupier style roulette which was semi automated, but they eventually went back to Interblock simply because Interblock is present everywhere in Vietnam and enjoys overwhelming popularity amongst players. It is one of the ‘must have’ games in clubs to meet the tastes of regular visitors.” Interblock Asia Pacific Pty Ltd is a 100% owned subsidiary of Slovenia’s Elektroncek d.d. Interblock is a globally recognised trademark for automated electro-mechanical and video roulette, dice and card products. The company, under the Elektroncek name, distributes its products in more than 50 countries around the world, and has more than 20,000 installed stations. BMM Compliance opens lab in South Korea BMM Compliance has been selected to open the first dedicated testing centre for gaming devices in South Korea. Through this testing centre it should become easier for gaming machine manufacturers from South Korea to be able to have independent testing performed for their own market and also meet the technical regulatory requirements of other jurisdictions around the world. The deal is a three-way partnership between BMM, the Arcade Game Regional Innovation Center (AGRIC) at Dongseo University in Busan and iReal Inc, a Busan-based technology developer working on products including virtual 4D animation. The facility, officially known as BMM Korea (Gaming Device Testing Center), will be based on the university campus. It will offer full gaming device testing and individual games platform testing. “Winning this exclusive partnership with the highly respected iReal and AGRIC partnership is a significant vote of confidence in how BMM Compliance conducts its business worldwide,” says Martin Storm, President and CEO of BMM International. “A number of Korean manufacturers approached us concerning an urgent need for a high-quality gaming device test lab located in Korea that would provide us with a facility that operates in our time zone and speaks our language. After considering a number of alternatives and possible partners, BMM Compliance was the only one that understood, and was responsive to, what we wanted and needed. We are very pleased to be partnering with them,” said Tae Soo Yun, Executive Director of AGRIC. BMM describes itself as the longest established and most experienced private independent gaming test lab in the world. The company is based in Las Vegas, Nevada and has offices in Lima (Peru), Midrand (South Africa), Graz (Austria), Barcelona (Spain), Melbourne and Sydney (Australia), Singapore, Macau and South Korea. Genting cleaning up Singapore listing According to a report by Union Gaming Research, Genting Singapore announced it will sell its UK casino assets to Genting Malaysia for S$689 million (US$493 million), which Union Gaming believes represents about an 8.6xmultiple of forward EBITDA. Prior to the opening of Resorts World Sentosa, the Genting Singapore listing consisted primarily of the UK casino assets (when it was known as Genting International). In its most recently reported quarter (1Q10), the UK assets generated S$126 million in revenues (US$90 million) and S$20 million in EBITDA (US$14 million), or a 16% EBITDA margin. This compares to what will ultimately be a massive margin story at Resorts World Sentosa, which reported a 33% EBITDA margin in its first stub quarter and appears to be going higher (S$335 million in revenue and S$109 million in EBITDA), according to the report. Union Gaming Research believes part of the motivation behind the sale of the UK casino assets to Genting Singapore’s sister company is a valuation play, with the UK casino assets representing a drag on the Singapore listing’s valuation. Genting Singapore is current trading at 15.1x 2011 consensus EBITDA expectations vs. Genting Malaysia at 5.0x 2011 consensus EBITDA. Genting Singapore currently has the richest valuation of all operators with exposure to Asia, which Union Gaming believes is already justified given the trajectory of the Singapore IR market. Harrah’s hopes to enter Macau Reuter’s reported that Harrah’s Entertainment Inc, the world’s largest casino operator by revenue, hoped Macau could allow new entrants to its local gaming market. Harrah’s, which was bought by private-equity firms TPG Capital LP and Apollo Management LP in a 2008 US$31 billion buyout, operates more than 50 casinos in six countries, including Las Vegas resorts Caesars Palace and Paris. Michael Chen, Harrah’s president for Asia, told Reuters he hopes his company would eventually be allowed into Macau, but did not give a timeframe or say how its entrance would be accomplished. “The government will make it clear when they want to invite new entrants in, and when they do we’ll be there,”Mr Chen said. “Now we are patiently waiting for the next opportunity to arrive,” he added, referring to gambling opportunities in Asia. In 2002, Harrah’s decided not to bid for a gaming license when the former Portuguese colony opened up its market to foreign casino operators, because it believed the regulators in the 14 jurisdictions in which it operates would not permit it to run casinos in Macau, Mr Chen told Reuters in an interview last year. While it has no casinos in Macau, Harrah’s paid US$577.7 million in 2007 for a 70.8 hectare golf course on Macau’s Cotai Strip. Mr Chen said Harrah’s, like most major casino operators, was also interested in other Asian markets such as Japan and Taiwan, where various levels of discussion were ongoing about opening the local gambling markets, but little had so far taken place in terms of definitive action. “In Asia, gaming is highly underpenetrated. We’re just at the beginning of the growth curve. We’ll be very excited if any of these markets open up.”