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Macau approves new US$2.5b MGM China casino

HONG KONG, Jan 10 — Macau gave casino giant MGM China the official go-ahead to build a second casino in what is the world’s biggest gambling centre yesterday, sending shares in the company soaring 7.0 per cent.

People start to queue prior to the opening of the MGM Grand Macau on December 18, 2007. MGM plans a second casino in Macau with 1,600 hotel rooms, 500 gaming tables and 2,500 slot machines. — AFP picPeople start to queue prior to the opening of the MGM Grand Macau on December 18, 2007. MGM plans a second casino in Macau with 1,600 hotel rooms, 500 gaming tables and 2,500 slot machines. — AFP picThe US$2.5 billion (RM7.75 billion) casino, to be built on the up-and-coming Cotai Strip, which houses rival casinos including Sands China, will feature 1,600 hotel rooms, 500 gaming tables and 2,500 slot machines, MGM China Holdings said.

The official announcement of the land concession contract, which appeared on the Macau government website, follows figures last week that showed the city’s gambling revenue jumped 13.5 per cent to a record US$38 billion in 2012.

MGM China shares jumped 7.0 per cent on the news to close at HK$15.86 on the Hong Kong stock exchange.

The approval was “a very important milestone in the project’s development timeline and likely came sooner than investor expectations”, Union Gaming Group analyst Grant Govertsen told Dow Jones Newswires.

MGM China Holdings, a tie-up between Las Vegas-based MGM Resorts International and Pansy Ho, daughter of Macau gambling tycoon Stanley Ho, first announced the land concession deal with the government in October but had been waiting for official approval.

The company said the design of the resort was at an “advanced stage” with construction expected to take three years. The land concession contract has an initial term of 25 years.

The new casino project highlights intense competition for the former Portuguese colony’s gaming sector, despite the fact that gaming revenue growth has fallen from the stunning highs of the past three years as China’s economic boom slows.

Semi-autonomous Macau, the only part of China where casino gambling is legal, overtook Las Vegas as the world’s gaming capital in terms of revenue after the sector was opened up to foreign competition in 2002.

Six firms are licensed to operate casinos in Macau, which was handed back to Beijing in 1999. — AFP-Relaxnews

 

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