(Bloomberg) — Genting International Plc, which is building Singapore’s second casino-resort, said it will buy Star Cruises Ltd.’s 25 percent stake in the project to help meet government requirements for a gaming license.
The companies, which are units of Genting Bhd., Asia’s biggest casino-operator by value, are discussing the price of the stake held by Star Cruises, Genting International said today in a statement to the Singapore exchange.
Genting Bhd. is creating a clearer ownership structure for its casino projects in Singapore and Macau after being queried by the city-state’s government. Genting International yesterday said it will sell its 25 percent stake in a project in Macau, which is linked to billionaire Stanley Ho, to Star Cruises.
„Genting International is trying to address the concerns of the Singapore government,“ said Sean Monaghan, a Singapore- based analyst with Merrill Lynch & Co. „Regulatory concern has become a significant issue to the company since the announced project in Macau of the greater group.“
The acquisition of Star Cruises‘ stake in the Singapore casino will give Genting International full control over the project on the city-state’s Sentosa island. This will help Genting International „in the management process of casino application in due course,“ the statement said.
On Feb. 27, the Singapore government said in a statement that the issuance of a casino license was a „separate matter“ from winning the rights to develop an „integrated resort.“
The company expects the Singapore casino-resort, which will include a Universal Studios theme park bigger than the one in Los Angeles, to generate SGD 15 billion (USD 9.8 billion) a year in tourist spending. Singapore expects its tourist arrivals to double to 17 million by 2015.
Las Vegas Sands, the world’s biggest casino-operator by market value, won the bidding last year to build Singapore’s first gaming resort.
Genting International and Star Cruises in December beat Eighth Wonder and Kerzner International Ltd. for the right to build the SGD 5.2 billion resort on Sentosa island. Star Cruises sold stakes to Ho and other investors to help fund the development, it said in January. Ho and the investors said they would hold a combined 6.99 percent stake in Star Cruises.
Rostam Umar, a spokesman for the Singapore Tourism Board, the government agency that headed the casino bidding process, couldn’t immediately be reached for a comment.
Shares of Singapore-listed Genting International closed trading on March 2 at 83 cents, from 81 cents a week earlier.