The company has entered into a transfer agreement to meet the property ownership requirement and tender for a new gaming concession contract.
Macau.- SJM Holdings Ltd has announced its purchase of the Oceanus property where the group currently operates the Oceanus casino. The HK$1.91bn (US$242.8m) acquisition is subject to the fulfilment of certain conditions, including approval of the transfer by independent shareholders at a general meeting scheduled for June 22.
The sum to be paid by SJM Holdings comprises HK$516m for the non-gaming area and HK$1.3m for the Oceanus casino area. The motivation for the purchase is the extension of the company’s concession contract with the Macau government, allowing it to meet a new property ownership requirement.
SJM Holdings said that while negotiating to extend its concession contract to December 31, 2021, it agreed to provide a letter of commitment to Macau authorities to ensure the restoration of public control of the Oceanus Gaming Area at the end of the concession period.
Under current gaming laws, franchisees must automatically return their casinos and related equipment to the Macau government without any encumbrances or limitations at the end of the franchise period.
The company said it “considers the transfer to be imperative as it enables SJM Resorts to operate both gaming and non-gaming businesses within Oceanus in a synergised manner which are complementary to one another.”
It also noted that Casino Oceanus was one of its best-performing casinos between 2017 to 2019.
SJM to absorb workers left unemployed by satellite casino closures
SJM Holdings’ executive director Angela Leong On Kei has promised that the casino operator would take care of employees who may be affected by the closure of satellite casinos linked to the company. Of the 18 satellite casinos in Macau, 14 operate under the licence of SJM Holdings Ltd while the other four are tied to Galaxy Entertainment Group (GEG) and Melco Resorts and Entertainment Ltd.
Last month, Emperor Entertainment Hotel Limited announced the closure of its casino at the Grand Emperor Hotel due to the difficult business operating environment caused by the Covid-19 pandemic in the last two years. The company had a service contract with gaming franchisee SJM, which expires on June 26.