Inside Asian Gaming

October 2014 inside asian gaming 45 Falcone Ups Ante at Ho Tram by $50 Million US hedge fund tycoon Philip Falcone is pressing his bet that Vietnam will end its prohibition on domestic casino gambling, plowing another US$50 million into The Grand – Ho Tram, the megaresort that opened last summer on the country’s South China Sea coast about 70 kilometers from Ho Chi Minh City. Privately held Asian Coast Development (Canada) Ltd, the investment group behind the $500 million Grand, announced the capital infusion, which was made by Mr Falcone’s Harbinger Capital, ACDL’s majority stakeholder. The investment is the second show of faith in as many months in The Grand’s positioning as the largest casino in Vietnam and its first true destination-scale gaming resort. In July, Chinese hotel magnate and Macau junket investor Chien Lee bought in for US$20 million through his NewCity Capital (see “Faith, Hope and Ho Tram” on Page 30) . US casino operator Pinnacle Entertainment is also a minority investor and is slated to manage a planned expansion of the resort with a second hotel and casino. Despite a beautiful beachfront location, The Grand’s two- hour distance from Ho Chi Minh by road has hampered it as an international drawing card in the absence of a locals market, and ACDL has high hopes for addressing that with a Greg Norman- designed golf course that opens this month. “We are also extremely excited about the future development potential of our project,” Mr Falcone said. The central government’s Ministry of Finance has submitted a package of regulatory reforms for consultation that include provisions for opening the country’s casino market for the first time to its 90 million citizens subject to certain income restrictions and other limitations. If approved by the prime minister’s office, which could happen before the end of the year, the expectation is that domestic play will be allowed on a trial basis at select venues, one of which, given the size of its investment, is likely to be The Grand. Mr Falcone said he is “encouraged” by the progress the reforms have made to date. Macau Investors Plan $300M Casino on Tinian More Macau money looks to be headed for the Pacific islands following an application by an investment group based in the city to take control of a plot of land on Tinian in the Northern Marianas for a 1,000-room hotel and casino. The Saipan Tribune reports that Alter City Group Holdings, as the entity is known, is partnering with STJ Golden Island Investments, a Taiwan company with a history on Tinian, on a US$300 million resort whose plans also call for a golf course, villas and other leisure attractions. Alter City, which is incorporated in the Northern Marianas, a self-governing US commonwealth in the western Pacific north of Guam, has asked the government there for a lease on 152 hectares that had been earmarked at one time for a similarly sized gaming resort proposed by another developer but never built. The Tinian government supports the application, the Tribune says, and has petitioned the commonwealth’s legislature for a quick approval of the lease. Alter City does not have a Tinian gaming license, but STJ is affiliated with a company that did. That company, HW Golden Island Holdings, a subsidiary of Taiwan construction giant Howarm, has proposed a number of resort-related investments on Tinian, and in 2012 was awarded a license by the Tinian Casino Gaming Control Commission in conjunction with a failed bid to buy the Tinian Dynasty Hotel & Casino, the Northern Marianas’ only casino. Tinian Dynasty, which has struggled financially, was taken over last year by Mega Stars Overseas Ltd, a Hong Kong group with Macau junket ties. Marianas Stars Entertainment, a Mega Stars subsidiary also incorporated in the commonwealth, was the losing bidder for a license to develop a multibillion-dollar casino authorized earlier this year for the main island of Saipan, which to date has only hosted small-scale machine gaming and charitable games. The Saipan license, which has been embroiled in controversy from the start, went instead to a company called Best Sunshine International, a subsidiary of Hong Kong-listed Imperial Pacific Holdings, whose portfolio also includes Macau junket investments. Prior to May, Imperial Pacific was known as First Natural Foods Holdings, a company that made news in 2013 when its founder and former chairman was charged by the Hong Kong Securities and Futures Commission with embezzlement five years after he disappeared from the city, allegedly a fugitive ever since. INTERNATIONAL BRIEFS Philip Falcone Tinian