Maybank sees Genting win Yokohama casino contest
Posted: Jun 3, 2021, 11:10 p.m.
Last update on: June 3, 2021, 11:50 a.m.
It’s only been two days since Genting Singapore and Melco Resorts & Entertainment (NASDAQ: MLCO) were revealed as the two operators moving towards the Yokohama Request for Proposal (RFP) process. An investment bank already claims that the former has the inner track.
In a note released yesterday, Maybank Investment Bank says Genting can beat its rival. The goal is to partner with Japan’s second largest city in its bid to win one of the country’s top three gaming licenses. That’s a more obvious assessment than that offered by Nomura earlier this week, which said the operator of Resorts World Sentosa has a 50% chance of coming out victorious in Yokohama.
Maybank says the odds are in Genting’s favor as the gaming operator partners with local companies Sega Sammy Holdings and Kajima Corp. on the integrated hotel complex offer. Kajima was the prime contractor for the aforementioned Singapore property. This partnership has another potential advantage. Genting operates one of Singapore’s two gaming sites, while Sega Sammy owns a minority stake in a South Korean integrated resort. Japanese regulators have long said they want to work with gaming companies that are well established in the Asia-Pacific region.
Melco works with the Japanese company Taisei Corporation, and Lawrence Ho’s company is one of the region’s largest casino operators, with properties in Macau and the Philippines, among others.
No surprise appeal to Genting by Maybank
Maybank claiming that Genting will win the Yokohama contest is not surprising, simply because the bank has previously said the operator is the city’s main competitor. These remarks were made about two weeks ago.
In our opinion, Genting Singapore performs better in promoting tourism, financial management and capability, and responsible gambling initiatives compared to Melco, ”Maybank analysts said in the new rating.
In a report released last month, the bank said that if 2028 was the first full year of operation of the Yokohama Integrated Complex, it would generate $ 6.5 billion in gross gaming revenue and $ 1.9 billion in gross gaming revenue. non-game sales.
This forecast is operator-independent, but the research firm says if Genting only owned 50% of the Yokohama project, profits would be increased by $ 1.36 billion.
Melco still viable candidate
Maybank’s outlook on Genting in Yokohama is obviously optimistic, and the operator clearly ticks many boxes for the city that are also likely to appeal to federal regulators. However, that doesn’t mean that Melco is just going through the movements in Japan.
As noted above, Melco is an established player in the Asia-Pacific region and has partnered with a Japanese company – points that could work in its favor.
Like Genting, Ho’s company also made a commitment to Yokohama even as rivals tired of bureaucratic delays and abandoned the process. Las Vegas Sands, Wynn Resorts and more recently Galaxy Entertainment have each pulled out of the Yokohama competition, while Genting and Melco remain committed.