Inside Asian Gaming

INSIDE ASIAN GAMING | October 2010 14 ‘pro-China’ elements in the chamber. Like his father before him, and like Dr Ho, Mr Fok junior is also a member of the Chinese People’s Political Consultative Conference, an advisory body to the Chinese government. Mr Fok junior is also well known to Hong Kong residents as President of the Sports Federation and Olympic Committee of Hong Kong and President of the Hong Kong Football Association. His Cruella de Vil-style hair (black with a bright silver streak running through it), his trademark centre parting and his aviator sunglasses, were a familiar sight on television screens and in newspapers during the equestrian events held in Hong Kong during the Beijing Olympics of 2008. Honourable compromise More important than his memorable sartorialstyleisthefactthathe’salmostfamily in terms of his pedigree, without actually being a Ho. That means he’s more likely to be acceptable to frequently squabbling Ho family members as a compromise candidate for chairmanship of either STDM or SJM, or possibly both. Even more significant is that the Fok Ying Tung Foundation, started by Mr Fok senior in 1984, owns 26.5% of STDM, and therefore a portion of SJM. Of the other possible candidates to succeed Dr Ho as chairman, Dr Ambrose So (an Executive Director as well as the CEO of SJM Holdings) is amply qualified. He is erudite (he’s been known to solve mathematical problems as a form of relaxation). He’s also shrewd (witness the way he has helped Dr Ho not only tackle the competitive challenge from the foreign operators in a post-monopoly market but actually helped rebuild SJM’s market share year on year from an historic low of 27% in 2008 to reach 31.1% in September this year). He does, however, suffer from the probably fatal flaw of not being family. As a result, while personally charming and reportedly fastidious in his approach to SJM’s internal politics, he could not be guaranteed to carry enough authority within the disparate Ho clan. The United States has many examples of fabulously rich men leaving their businesses to much younger wives—as if to make up for a lifetime of hard-nosed business deals. It seems unlikely that kind of late-blooming sentimentality will play a role in the case of Dr Ho and SJM. Dr Ho will be a venerable 89 at his next birthday in November—a hefty four decades older than his current consort, Angela Leong On-kei. Ms Leong has managed to become a Director of SJM on the strength of her strong domestic resume, but that may prove to be the full extent of her rise in the company hierarchy. Whatever happens in the succession race, Ms Leong and the children she has borne Dr Ho are likely to be well provided for from his 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 operation 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, Ms Ho could be kept ‘onside’ by SJM—to use the jargon of politics—by being offered 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 SJM satellite casino in her own right—either via a new build project, or via a stake or management role in an existing satellite. Lawrence Ho, one of Dr Ho’s 17 children, and often mentioned in relation to the succession, has experience of running a majorMacau-facingpublic gaming company as Co-Chairman of the Sino-Australian joint venture Melco Crown Entertainment (Nasdaq: MPEL). He doesn’t as yet, however, have a solid track record of success in the sector. Indeed, MPEL’s first effort, the six- star, VIP focused Crown Macau (now Altira) had effectively to be rescued by his father’s business associates after it opened six months late and 203% over budget in May 2007.Themarket-busting 1.35%commission eventually offered to junket consolidator AMA in December 2007 in exchange for bringing in much needed high rollers to Maths whiz—Ambrose So Angela Leong On-kei—inside the tent or outside it? In Focus