Inside Asian Gaming

INSIDE ASIAN GAMING MAY 2018 16 MACAU’S GAMING REGULATOR will still have 482 gaming tables up its sleeve to allocate as it sees fit once SJM completes the “Big 6 development cycle” with the launch of Grand Lisboa Palace next year. That’s the equation put forward by boutique investment bank Union Gaming in a comprehensive summary of Macau gaming table allocations. Providing a detailed outline of the major developments in Macau over the next few years, Union Gaming calculates that there are currently 657 tables remaining under the government’s table cap following the allocation of 125 tables to MGM Cotai in February. DICJ TO HOLD 482 GAMING TABLES FOR ALLOCATION AFTER SJM’S COTAI IR LAUNCH Australian-listed Donaco International Limited has been granted an injunction by the Supreme Court of New South Wales to freeze the shares held by the Thai vendors of its Star Vegas casino resort in Cambodia. Donaco is seeking damages of US$120 million from the vendors – named as Somboon Sukcharoenkraisri and his two sons Lee Bug Huy and Lee Bug Tong – for continuing to run gaming operations in defiance of non-compete provisions at Star Paradise, which is located adjacent to Star Vegas in Poipet. The trio had previously been granted permission to host gaming facilities under the management of Donaco in a deal that saw the latter paid a monthly management fee of THB5 million (US$151,000), but that agreement expired in 2017 with no new management arrangements put in place. Under the terms of non-compete Donaco wins injunction against Thai vendor to freeze major shareholding provisions, the vendor is not allowed to be involved in any other casino or gaming business in the Poipet area. Donaco won an injunction via a Cambodian court in December to close Star Paradise casino and is continuing to pursue enforcement of its legal rights via arbitration proceedings in Singapore. Arbitration awards from Singapore can be enforced in both Cambodia and Thailand. In a filing to the Australian Securities Exchange, Donaco announced that it has now been granted an ex parte interlocutory order in the nature of a Mareva injunction in NSW to freeze the Donaco shares held by the Thai vendors. MGM Cotai’s opening leaves SJM as the only one of Macau’s six concessionaires yet to finish its Cotai integrated resort but recent table allocation trends suggest there will still be plenty remaining following the completion of Grand Lisboa Palace. “Under the assumption that SJM also gets an initial batch of 100 tables for Grand Lisboa Palace in 2019, and that the government allocates ‘catch-up’ tables to MGM and SJM after the license situation is finalized, this would leave 482 tables in the government’s inventory,” reasons Union Gaming analyst Grant Govertsen. The government announced in 2012 the implementation of a table cap that would run for 10 years and allow for 3% compound annual growth rate in the number of tables available to the entire Macau casino market. Although it provided no definitive numbers at the time, Govertsen calculates that the 5,500 tables operating in Macau in 2012 means up to 1,892 new tables could be issued through 2022. At present, only 1,235 of those have been allocated, leaving 657 still available. Even accounting for SJM’s likely allocation – and assuming that MGM and SJM will be awarded another 75 tables combined as part of a “catch-up” allocation by 2020 – that still leaves 482 tables potentially available.