James Packer’s US$4 billion gamble in Macau pays its first dividends
The Hollywood-themed Studio City complex is boosting Melco Crown Entertainment market share.
Macau.- Despite Macau’s decline in gaming revenue for 19th month in a row, James Packer was still determined to make a US$4 billion investment in the Asian gambling hub. Packer’s Crown Resorts owns a 34 percent stake in Melco Crown Entertainment. The Australian company bet on the Studio City complex to aid in the city’s recovery by focusing on mass market gambling and family-friendly entertainment.
After only two months Melco Crown’s market share spiked above 16 percent in comparison with October’s 13 percent. According to Vitaly Umansky a Bernstein Research analyst, “since Studio City opened in late October, Melco Crown has grown its market share to above 16 percent level versus historically around 13 to 14 percent.”
Bernstein Research reckons that Studio City generated MOP 343 million (US$60 million) from mass table gross gaming revenue last month, despite the fact that the casino was only allowed to operate a maximum of 250 new-to-market gaming tables and 1,233 new gaming machines at the Studio City gaming areas.
The city government’s permitted only 200 gaming tables and 1,233 gaming machines in place when Studio City opened. The remaining 50 tables would start operations this month. Lawrence Ho, Ceo of Melco Crown expected to operate 400 tables in the newly-opened casino. Still, Melco’s table allotment surpasses the gaming tables that Galaxy Entertainment Group was entitled to allocate in Galaxy Macau and Broadway Macau casinos.
