Wynn Resort Plan Not Yet A Winner In Macau

Hong Kong – Casino magnate Steve Wynn’s flagship Wynn Resorts is reportedly planning a secondary listing in Hong Kong, aiming to raise USD 3 billion to finance the construction of a mega-resort complex in Macau. The share offering, however, is under a cloud amid negative market sentiment.

Wynn Resorts has appointed UBS, Deutsche Bank and Morgan Stanley to arrange the Hong Kong listing, which is likely to be the largest initial public offering in the city this year if it proceeds. The IPO could provide funding for Wynn Resorts to complete Encore, a 400-room all-suite hotel tower scheduled to begin operating in the first half of 2010 on the Macau peninsula, as well as to construct a mammoth resort in the Cotai Strip, on reclained land linking the adjoining islands of Coloane and Taipa in the former Portuguese enclave of Macau, Hong Kong’s South China Morning Post reported Thursday.

Wynn Resorts opened its first casino complex in Macau in 2006 and expanded it by adding 85 gaming tables, 551 new slot machines and a dramatic „performance lake“ with shooting fountains as a signature attraction in December 2007. Subsequent to the expansion, the Wynn Macau Resort has approximately 390 gaming tables, 1,190 slot machines, 600 deluxe hotel rooms and suites and about 45,000 square feet of retail space.

To keep pace with local casino tycoon Stanley Ho’s Sociedade de Jogos de Macau and Las Vegas-based rivals such as the Venetian, MGM Mirage and Las Vegas Sands in the former Portuguese colony, which opened up its gaming industry–formerly a monopoly concession–to competition in 2002, Wynn announced the new resort plan in the fall of last year. The resort, with a 1,500- to 2,000-room all-suite „villa hotel“ and casino, will be built on Wynn’s 52-acre plot in Cotai Strip, just to the east of Melco PBL Entertainment’s USD 2.4 billion City of Dreams resort complex.

Yet, Wynn’s ambitions may be curbed thanks to uncertainty and unfavorable credit and real estate market conditions. In the United States, shares of Wynn Resorts have slid 56%, to their present level of USD 77.56, from the peak at USD 176.14 in November last year. In Hong Kong, Macau-related stocks have all skidded more than 50% in the past few months, as severe competition has shaved casino profits.

SJM, the casino operator owned by Stanley Ho, who is ranked 113th on the Forbes billionaire list, put off its scaled-back Hong Kong listing on Wednesday by a week as a result of a lawsuit filed by Ho’s estranged sister, Winnie Ho.