The bidding war for the casino operating licenses started after the Macau government opened bids on Friday from seven companies, including a wildcard from Malaysian operator Genting Group. The seven candidates will compete for Macau’s six casino licenses with the current permits set to expire at the end of the year.
The opening was graced by some of the most distinguished guests, including Macau’s top officials. City’s Economy and Finance secretary Lei Wai Nong and Secretary for Administration and Justice André Cheong attended the event along with top executives from Macau casinos Las Vegas Sands, Macau unit Sands China, Wynn Macau, and MGM China.
Galaxy Entertainment, Melco Resorts, and SJM Holding along with the aforementioned names, submitted their bids for the license ahead of the deadline on Wednesday. The last-minute arrival is GMM Ltd, as a wildcard, has posed a challenge to the existing operators, amid a decline in gaming revenues.
GMM, controlled by Malaysian casino tycoon and Genting Chairman Lim Kok Thay, surprised a few people with its application. Several analysts and experts believe that the arrival of a foreign power can disrupt the preexisting local operators in the gambling capital of the world.
“Genting Group has its own strengths, but we don’t think it offers any unique attributes that would persuade authorities to make a change, We believe the Macau government needs stable and healthy development of the mass-market gaming business more than ever. The six incumbents appear best positioned to assist the government to achieve this goal with the least risk,” Citigroup Inc. analysts led by George Choi wrote in a note Wednesday.
“There is a chance they can topple one of the incumbents. They (Genting) think so, too, otherwise they wouldn’t have laid out a HK$10 million ($1.27 million) buy in bet,” said Ben Lee, founder of Macau gaming consultancy IGamiX.
Notably, the winning bids will be announced by the end of the year as announced by Justice Secretary Cheong. The new casino licenses will commence next year, and the winners (expectedly the six incumbents) will hope to flourish in the future after investing $40 billion in Macau collectively over the past two decades. The bids were submitted in person via two large stacks of paper files reaching the government on Wednesday.