Investment plans reach MOP100 billion amid recovery uncertainties
The investment plans of future gaming concessionaires cumulatively amount to a staggering MOP100 billion amid uncertainties surrounding the city’s full border opening.
According to a TDM report, the gaming tender committee has summoned the seven bidders for “a new round of negotiations that have already entered the final phase.”
The meetings (the details of which are undisclosed) are significant for the gaming operators as they battle to secure a 10-year concession.
Some incumbent gaming operators have expressed their satisfaction with the timetable for the tender process.
In an earnings call with analysts last month, president of Sands China, Wilfred Wong, said that good progress was being made and hoped that a further notice of next steps would be provided towards the end of the month.
Melco expressed similar sentiments, describing the process as “transparent and smooth.”
Last month, analysts at Credit Suisse (Hong Kong) suggested that the process was not as straightforward as operators hoped, noting that the government had asked bidders for more investment in non-gaming projects than expected.
The MOP100 billion investment comes at a time when several casino tables sit empty – even during the traditionally peak period – as the city adheres to a zero-Covid policy that imposes stricter border restrictions whenever new cases are detected.
With the crackdown on junkets – which formerly facilitated affluent gamblers who contribute to 43% of the sector’s earnings – the return of the investment remains unlikely for now.
The committee includes three of Macau’s five policy secretaries: Secretary for Administration and Justice André Cheong Weng Chon, Secretary for Economy and Finance Lei Wai Nong, and Secretary for Social Affairs and Culture Elsie Ao Ieong U.
With the city’s biggest gaming law overhaul, the Chief Executive has the power to decide not to award some or all of the concessions put out to tender.
The industry will face fresh concessions on January 1, 2023.
