Betting on Macau’s Sands China after the death of US billionaire Adelson By Reuters

© Reuters. FILE PHOTO: Exterior view of the Venetian Macao, part of the Sands China Ltd development in Macao

By Farah Master HONG KONG (Reuters) – Sands China (OTC 🙂 Ltd’s adjustment to life following the death of billionaire founder Sheldon Adelson, a year before the company’s gaming license expires, could open up opportunities for Chinese investors to acquire a stake. said industry executives. Without the larger-than-life visionary at the helm, the company may be more willing to sell a stake to win favor with the Chinese government, or suitors may use their absence to buy an unopposed degree of control, executives told Reuters. . Adelson, who died on January 11 at age 87, was widely recognized for helping transform the Chinese territory of Macau from a haunt of gambling halls into a hub of luxury resorts and convention centers with revenues that now outshine those in Las Vegas, home of its American flagship Las Vegas Sands (NYSE 🙂 Corp. However, the gaming licenses for all six Macau casino operators, including Sands China, will expire in 2022, and the government still It has not detailed the bidding process. “This presents a window of opportunity for Chinese parties to come in and take a strategic stake in the company,” said Ben Lee, founder of Macau gambling consultancy IGamiX. Having a Chinese partner would improve Sands China’s chances of a new concession, he said, particularly with the removal of Adelson’s link to US President Donald Trump, whom he financed and with whom he had regular contact during Trump’s tenure against. China. Parent Las Vegas Sands derives most of its income from Asian properties, including Venetian and Parisian in Macau and Marina Bay Sands in Singapore. The casino operator will open the British-themed Londoner resort in Macau in February. Sands did not immediately respond to requests for comment. BEIJING’S DECISION Any decision about a Chinese company buying a significant stake in Sands China would not be made in Las Vegas or Macau but by Beijing authorities, said Matthew Ossolinski, chairman of Ossolinski Holdings, an investor in Las Vegas Sands since 2008. Chinese ownership in any of the large operators makes political sense and could be a net benefit to existing shareholders, “he said. In January, Snow Lake Capital, a shareholder of MGM China (OTC 🙂 Holdings Ltd, urged MGM Resorts (NYSE 🙂 International to sell 20% of the Macau casino operator to a Chinese strategic partner to help secure its local casino license. In an open letter, Snow Lake said the markets already reflected concerns over the renewal of licenses for US Macau operators through business performance and valuation, citing the high profitability but low valuation of the market leader Sand s China. DIVERSIFICATION PRICE Casino operators are trying to make sure they stay on the right side of the authorities, for example by hiring more local staff and supporting patriotic education initiatives. Responding to calls from the government to help diversify Macau’s gambling economy, Sands China built the territory’s largest convention center and exhibition space, entertainment theaters and around 13,000 hotel rooms. Adding a Chinese partner would improve Sands China’s licensing possibilities and also increase its marketing capacity in mainland China, said Anthony Lawrance, managing director of consultancy Greater Bay Insight. “It would be useful for what comes next in Macau after the licenses are granted: access to new land and opportunities in (the mainland city of) Hengqin.” Still, risks to would-be suitors include legal battles related to the opaque process through which Sands China obtained its Macau casino license in the early 2000s. In a case due to go to trial in June, the former Asian American partner, led by Taiwanese businessman Marshall Hao, is seeking $ 12 billion to make up for lost earnings from 2004 to 2020 after Sands China opted to switch partners.