Inside Asian Gaming

undergone by the US parent. MGM MIRAGE formally announced that transformation to MGM Resorts International in June. Arguably, however—unlike its compatriots Las Vegas Sands Corp and Wynn Resorts—MGM Resorts showed that culturally and financially its focus is still on the United States rather than Asia, by choosing to make the main announcement in Las Vegas rather than Macau. In Macau, Mr Murren has, however, reportedly been party to other changes including a decision during the summer to step up cooperation with Macau’s junket operators. Macau junket operators are a group associated—particularly in the minds of some law enforcement people in the United States—with the ‘old’ Macau of Dr Stanley Ho’s monopoly years. As is often the case, popular perception tends to lag behind reality. Most companies associated with the modern junket trade in Macau now operate more like banks rather than backstreet moneylenders. Their client accounts are managed via computers and spreadsheets—and some junket related businesses are even public companies listed in Hong Kong. Mr Murren will have understood that cosying up further to Macau junkets will have carried some political risk in the company’s home market. An example is the hostile reception given by the New Jersey Division of Gaming Enforcement to the company’s partner in Macau, Pansy Ho, daughter of Dr Ho. The risk to the Macau operation of not courting more junket business was even greater. At one stage, part way through August, some analysts were muttering MGMMacau had hit an all time low share of Macau gross gaming revenue of only 6%. With at least one new deal signed recently with a junket investment company to provide extra high rollers, MGM Macau could at long last start to fulfil its promise after a lacklustre two and a half years. If it can tie those new VIP customers into MGM’s famously efficient and well designed rewards and loyalty system, then the next 12 months could see Mr Murren’s smile broaden even further. 22 (17) Jim Murren Chairman and CEO MGM Resorts International Mr Murren’s background as a Wall Street high flyer must have come in useful in the last 12 months when it came to the major job of restructuring MGM Resorts International’s global debt. That stood in November last year at US$13 billion. Mr Murren, a former Director of Research for Deutsche Bank, will have needed all his analytical and financial skills to solve that conundrum. Most of his focus in the year since the previous Asian Gaming 50 has naturally been on the core operation in the United States. In particular, he needed to engineer the successful launch of the US$8.5 billion CityCenter in Las Vegas and to ensure its immediate and strong contribution to the company balance sheet. But the easing of the pressure on the company’s finances after successful moves to restructure and in some cases reschedule its global debt during 2009 and early 2010 has given MGM Resorts time to refocus on its 50:50 joint venture operation in Macau. This has led to a number of changes, including a revamp on external image and general marketing. MGM Macau—opened in December 2007at a cost of US$1.25billion—is nowa little less focused on the lion branding that means so much in the West, and a little heavier on lucky dragons for its predominantly Chinese customers. In addition, the renaming of the Macau operation from MGM Grand Macau to MGM Macau was in line with a global rebranding exercise 21 (26) Angela Leong On-kei Director Sociedade de Jogos de Macau the SJM setup, there are some that remain sceptical she can maintain her position independent of Dr Ho’s involvement in the company. It would probably be unwise to write her off for several reasons. Firstly, the children she has borne Dr Ho may form a kind of insurance policy working in her favour in a still dynastically-minded Chinese business culture. Secondly, while she may not have been born to be a gaming executive, having pursued a career as a professional dancer prior to setting up home with Dr Ho, she has grown into the role. She is reputed to be a tough and savvy deal maker. Potentially working against the 49-year- old Ms Leong is that Dr Ho was already a septuagenarian when he started a family with her. As a result, the children of that relationship are not yet old enough to jockey for position with Pansy Ho and Lawrence Ho, two of Dr Ho’s older children who already have between them nearly ten years of casino construction and operations know- how in Macau. Another potential wild card to throw into the SJM succession game is Dr Ambrose So, Chief Executive of SJM and a long time lieutenant of Dr Ho. At a recent press event at Ponte 16, an SJM licensed property in Macau’s historic inner harbour district, it was Dr So and not Ms Leong that made an announcement about SJM’s plans for a resort on Cotai, Macau’s fast-growing mass market playground built on land reclaimed between the islands of Taipa and Coloane. Whatever happens in the succession race, Ms Leong and her children are likely to be well provided for from Dr Ho’s reported US$2.1 billion fortune. That likely bequest, and the business and political contacts Ms Leong has made during her three years as a director of SJM, may be enough to enable her to form a Macau gaming dynasty in her own right. Such a role could possibly be as a minority shareholder in someone else’s project (she has been linked—though without any independent confirmation—to a recent anonymous share purchase on the stalled Macao Studio City project). Alternatively, SJM could seek to keep Ms Ho ‘onside’—to use the jargon of politics— by offering her some kind of role handling the relationship between SJM and its satellite properties (those licensed by SJM but not directly managed by the company). Or she might become an operator of an SJMsatellite casino in her own right—either via a new build project, or via a stake or management role in an existing satellite. What role, if any, will Ms Leong play in the running of SJM once her partner and the father of her children, Dr Stanley Ho, is no longer involved in the business? And will SJM even continue to exist in its current form? Those two questions are likely to become increasingly important in the coming months and years. Given that it is domestic rather than blood ties that cement Ms Leong’s place in INSIDE ASIAN GAMING | September 2010 30