Inside Asian Gaming

INSIDE ASIAN GAMING | March 2011 38 SJM Succession I t’s not 100% guaranteed at this stage that Pansy Ho will assume leadership of STDM/SJM. A compromise or figurehead candidate could emerge in a United Nations-style fudge as a way of uniting the warring Ho family factions. The effectiveness question arises, though, not because the STDM/SJM role might clash in US regulators’ minds with Ms Ho’s 50% ownership of MGM Macau. It’s because some Macau insiders suggest she may have to make quite a lot of adjustment to her personal management style if she is to fulfil the STDM/SJM role effectively. Macau is a place where most business and political deals are done in backrooms and tied up long before they reach the eyes and ears of the media. A key attribute of the top job at STDM has traditionally been the ability to do those backroom deals in private and keep a diplomatic front in public. If that remains a key attribute for the next person in the STDM hot seat, then Ms Ho can hardly be said to have got off to a flying start. A two month-long battle via the public prints—and rather bizarrely via YouTube—over who should control Dr Ho’s shares in STDM is hardly the kind of thing to build the confidence of the market and of politicians that there will be a smooth and harmonious transition of power within STDM. To be fair to Ms Ho, the fact her father has four different families by four different women was always going to make the transition difficult, when STDM as it is today is essentially a family business. It didn’t start out that way back in 1962, however. It started out as a four-way partnership between four (unrelated) families, and the shareholdings of the current business reflect those historic roots. Because Dr Ho personally has never had a majority of the STDM shares, he has spent his career being part diplomat, part corporate hustler. Co-operation or at least co-existence between the shareholders has been important in getting anything done. When faced with an intransigent shareholder wanting her own way—as STDM was for several years in the case of Dr Ho’s sister Winnie Ho and her opposition to certain aspects of the flotation of SJM in Hong Kong—then it required leadership of enormous patience and diplomatic skill to be able to broker a deal. In the case of the IPO, that patient deal had to be brokered at the expense of market opportunity. The amount SJM eventually raised from the delayed flotation in June 2008 was less than half than what analysts had been estimating 18 months earlier. Some in Macau wonder if Pansy Ho has the instincts To the Manor Born or to the Manor Raised? How effective would Pansy Ho be as boss of STDM/SJM? Successor Checklist  Hard-nosed dealmaker  Sharp business acumen  Broad public support  Beijing’s blessing APPOINTED Natural born heiress?—Pansy Ho