Inside Asian Gaming

INSIDE ASIAN GAMING | October 2013 28 IN FOCUS Paradise has led the country’s foreigners-only market since it was legalized in 1967, though in recent years, Grand Koerea Leisure, operator of the Seven Luck brand, has emerged as a serious contender for the biggest share. As to why Caesars and Tokyo-based Universal failed to make the cut, no reasons were publicly given, but it was the Ministry of Trade that specified “qualified” in a statement on the new plan. Caesars, the largest casino operator in the United States, is laboring under the industry’s heaviest debt load as a result of a 2008 buyout by private-equity interests. Universal is under criminal investigation in the Philippines and the US in connection with dealings related to its planned development of a resort casino in Manila. The South Korean government has approved one FEZ casino proposal to date—a KRW800 million ($730 million) joint venture in Incheon between Paradise Group, one of the two operators that dominate the country’s foreigners-only market, and Japanese pachinko giant Sega Sammy Holdings. The resort is slated to open in phases beginning in 2016 with two hotels, a theme park, a convention center and a casino featuring 450 table games at full build-out. The joint venture company, Paradise SegaSammy, announced in July that rather than obtaining a separate license for the casino within the planned IR, it was going to develop the complex as an expansion of Paradise Casino Incheon’s current operations. This obviates the need to obtain a separate casino license for the IR. Raising the Foreigners-Only Stakes South Korea’s foreigners-only casino market generates around US$930 million annually and consists of 16 relatively small SegaSammy IR is designed to be of sufficient scale to meet the coming competitive challenges—its planned 450 tables is twice as many as Paradise operates now in all five of its casinos in the country. Paradise has led the country’s foreigners- only market since it was legalized in 1967, though in recent years, Grand Koerea Leisure, operator of the Seven Luck brand, has emerged as a serious contender for casino hotels serving mostly Japanese and Chinese players. There is also one large and lucrative casino in the remote northeast of the country that is open to Koreans called Kangwon Land that generates in excess of US$1 billion annually. The foreigners-only sector faces the twin threats of the opening of new integrated resorts across the region and looming legalization of casinos in Japan. The Paradise Total Number of Foreign Visitors to Korea, YoY Change Total Number of Chinese Visitors to Korea, YoY change Source: Korea TourismOrganization