Wynn’s Le Reve settlement
Steve Wynn has settled an out of court settlement with Lloyd’s of London over a Picasso painting he damaged. Repairs for the damaged painting, Le Reve, were estimated to be US$85 million. Wynn was showing the painting (which is French for “The Dream”) to a buyer to sell for US$139 million when he poked his elbow through it. Wynn originally paid US $48.4 million for the painting in 1997. The terms of the settlement were not disclosed.

Credit Suisse sees eSun rising
Credit Suisse has chosen Macao Studio City parent eSun as one of its best picks for the Year of the Pig. Citing the synergy between eSun’s entertainment strength and slated casino, retail and hotel venture in Cotai, analyst Gabriel Chan said, “We believe [eSun] can leverage off its entertainment business by arranging for its Asian pop stars to perform in Macau, which should attract not only mainland Chinese, but also tourists from South-East Asia”.

Unlike other companies spearheading projects on Cotai, eSun is poised to receive an advance positive cash inflow with their joint venture with Cyber One Agents, a powerhouse group led by David Friedman. And that’s before its casino-centered resort actually opens in 2009. The company also plans to buy out then privatize 37 percent of its currently owned Singapore-based movie company, Media Asia. Credit Suisse sees this as a positive step for the company. Indeed, they forecast net earnings at HK$866.5 million for fiscal 2006, HK$721.5 million in 2007 and HK$952.8 million in 2008. Meanwhile, Goldman Sachs has set a 12-month price of HK$ 11 for eSun stock. Credit Suisse has their eSun price at HK$10.20. It seems eSun is rising.

Casino Ponte Q3 Opening
If all goes as planned, Casino Ponte 16 will open in Q3 2007. The anticipated opening of the mixed casino-resort complex a few blocks from central has already garnished HK$ 2.4 billion in investment. The project is a cooperative endeavor between SJM and Macau Success. At a recent shareholders meeting, the Executive Director of Macau Success, Lee Siu Cheung, expressed his confidence in a timely opening and in the capital supply to fuel its’ success.

Sands junket acquisition
A former timber company turned gaming interest recently said that they will pay HK$765 million to control the profits’ of two high-roller gambling junkets that service Sands in Las Vegas and Macau. The company, known as the Teem Foundation Group, last year acquired a 49 percent interest in the junkets. This year, they’ve committed to purchasing the remaining stakes in a cash-in-shares deal, reports Neil Gough in the South China Morning Post. Teem has already paid a HK$ 362 million deposit. The rest of the balance will be financed with HK$ 57 in cold currency, an HK$ 118.8 million convertible bond, HK$ 26.8 million in straight-up shares and a HK$ 200 million promissory note.

Galaxy on credit watch
Standard and Poor’s rating service recently said that Galaxy Entertainment Group Ltd. will remain on credit watch. The S&P action stems from Galaxy’s December 2006 issuance of US$ 24 million worth of zero-coupon, zero yield notes due in 2011, according to media reports. S&P analyst Mary Ellen Olson stated that”, Our concern focuses on the potential for a significant increase in the financial leverage and increased execution risk associated with the expansion of its major Macau project, the Cotai Mega Resort“. The credit watch status will hold until a review of Galaxy’s business plan and 2006 financial accounts have been completed.

Melco deal & upgrade…
Melco International Development Limited (HKEx Code: 200) entered into an agreement with Singapore listed LottVision Limited, to swap 29.47 percent of its existing shareholding in PAL Development Ltd. In exchange, Melco will get new shares issued by LottVision. These shares will form 28.5 percent of LottVision’s enlarged share capital. The end game? Melco will become LottVision’s singe largest shareholder. In other Melco related news, Citicorp analyst Anil Daswani recently wrote a client note contending that the sharp ascent of the Melco PBL shares was “overdone”. He hence upgraded Melco’s status from “Hold” to “Sell” and upgraded his price target from US$ 18.10 to US$ 21

…and rolls out profits
Melco International Development posted a more than fivefold surge in profit last year on a one-time gain from the listing of its casino venture, according to reports. Melco’s net income was HK$ 3.1 billion or US $397 million. Sales increased 33 percent to 801 million dollars. Shares of Melco have multiplied more than 13 times since the Sands opened in 2004. This year, however, stocks have fallen 24 percent. The company did not provide a full stock report.

G2E Asia Sold Out
Global Gaming Expo Asia (G2E Asia) has announced “a sold-out show floor”, which is an 80 percent increase in exhibitor participation over 2006. The inaugural G2E Asia will feature Aristocrat Technologies, Bally Technologies, Konami Australia, IGT Asia, Stargames, a Shuffle Master International Company, Elixir Group and others. One of the events organisers, Frank Fahrenkopf (president and CEO of the American Gaming Association) said that the “tremendous interest in G2E Asia from gaming manufacturers illustrates that proactive participation in the Asian markets is increasingly becoming a business imperative”. G2E Asia is the region’s premier event for gaming suppliers and manufacturers from all over the world. G2E Asia 2007 will be held June 13-14 at Macau Tower Convention & Entertainment Centre in Macau.

SJM reports MOP 2.5 billion profit
Stanley Ho’s SJM reported MOP 2.5 billion (US$ 310,561,110.28) in net profit for 2006, a year-on-year drop of roughly 30 percent, Ambrose So Shu Fai told local media. The news was delivered at the general annual meetings of SJM and STDM. Also announced were STDM’s figures for last year, which amounted to a net profit of MOP 4 billion. Ho himself was unable to attend the meeting because he was “slightly” under the weather. Ho’s fourth wife, Angela Leong On Kei, and his right-hand man, Mr. So, were both in attendance at the meetings for the results release.

LVS whipping Hengqin bonanza State-side
Despite the non-transparent nature of what will happen on Hengqin Island, LVS Senior Vice President of Finance Scott Henry is whipping up excitement for it in the United States. Henry recently said at a retail, restaurant and consumer conference that Hengqin could generate US$ 23 billion to US$ 65 billion in real estate revenue for the LVS. He further commented that the Sands hopes to build 80 million square feet of resort space mixed with residences and a golf course. Beijing has yet to approve of the project.

Buying Down-under
Macau expatriates recently made their mark on Australia’s northern
beaches by buying property like mad, according to reports. One Macau made sale for 5 Lewis St, Balgowlah went for US$ 1.7 million. The trend is part of Asia based expats from Dubai to Shanghai who are snatching up select Aussie beach estates. They’re even “underpinning the high rolling Palm Beach market”, according to reports.

Speymill activity
Speymill Macau Property has paid US$ 28.8 million for 24 residential units on the Nam Van Peninsula. The company said it will spend HK$ 15 to refurbish the units. As of March 15, 2007 New Star Asset Management Ltd had an interest in an aggregate of 4,825,000 ordinary shares in Speymill, representing 6.03 percent of the issued shares of the company’s capital.

Ayala invests in Macau
The third richest family in the Philippines, the Ayala’s, are pouring US$ 100 million into Macau and Beijing. Through their holding company Ayala Corp and its subsidiary Ayala Land (the largest development firm in the Philippines), they have purchased a residential site in Macau and an existing site in Beijing. Sources say they plan on building a “new concept” luxury residential project in Macau. They paid US$ 100 million for their two China properties. Richard Yu of Arch Capital Management of Hong Kong is managing Ayala’s finances for their new China foray. In 2000 Ayala invested HK$ 600 million for a luxury residential project, Grosvenor Place, in Repulse Bay. The company is famed for building the Makati financial district in Manila.

Local property may see 20 percent price jump
Macau will surge ahead of Hong Kong and Shenzhen as a short-term property play for investors, industry analysts forecast. Over the next 12 months, Macau home prices may jump as much as 20 percent, Dao Heng Securities analyst Eric Yuen Chi-Fung said. Reports show that foreign buyers constituted 34.5 percent of Macau home purchases in 2006, a 26.9 percent rise from 2005. For all residential transactions, foreign buyers spent MOP 18 in 2006, a 49.8 spike from 2005. Of these deals, 45.3 percent were made by Hong Kong investors; mainlanders also constituted 45.3 of overseas made home buys in Macau.

CapitaLand confirms HK$ 658.8 million for Cotai
CapitaLand has confirmed that they have finalised their one-third stake purchase in East Asia Satellite Television (Holdings) Ltd. for the Macao Studio City project on Cotai. They paid a handsome HK$ 658.8 for the honour. CapitaLand has also paid another US$20 million in cash to eSun as reimbursement for one-third of the US$60 million working capital that had been previously advanced to Cyber One, which holds a 40 percent stake in MSC.

16.6 % GDP growth in 2006
Macau’s gross domestic product in 2006 saw a16.6 percent spike, its second highest growth since the 1999 handover, according to the Macau’s Statistics and Census Service (SCS). They also showed that the GDP reached a record MOP 114.36 billion (US$ 14.30 billion) in 2006. The gaming industry saw a 22-percent jump in 2006.

Mainland credit card spending US$1.5 billion
Mainland visitors spent US$1.5 billion with credit cards in Macau last year, an increase of 113 percent. The trend is expected to climb as the Cotai strip takes off this year with the opening of the Venetian Macao.

Vietnam partnership
Vietnam and Macau officials have committed to mutually cooperate with labour, tourism, air transport, education and culture. Vietnamese Deputy Prime Minister and Foreign Minister Pham Gia Khiem and Chief Executive Edmund Ho Hau Wah came at the invitation of Chief Executive Ho. They agreed to promote exchange delegations among administrative, law-making, judicial sectors and mass organisations “in order to boost mutual understanding, laying foundation for a stable and long-term cooperation for mutual benefit”. Also during their visit, Deputy PM and FM Khiem met major economic groups and business and did sightseeing.

Population climbs
The resident population of Macau was estimated at 513,427 as of Dec. 31, 2006. This represents an increase of 29,150 over 2005, or a year-on-year growth of 5.8 percent, according to SCS official statistics issued Thursday. The figures show that among the resident population, 50.8 percent were female and 49.2 percent male. The youth population (aged between 0 and 14) accounted for 14.7 percent, the adult population (aged between 15 and 64) 78.3 percent and the elderly population (aged 65 and above) 7.0 percent, the figures showed. The number of legal immigrants from the Chinese mainland stood at 2,800 in 2006, with 239 arriving in the fourth quarter. Among those arriving in 2006, 72.9 percent were female and 65.6 percent came from neighboring Guangdong province. In the fourth quarter of 2006, 358 illegal immigrants were repatriated, for an annual total of 1,085 persons, a 110.3 percent rise over 2005, SCS stated.

China an India Fund
Citigroup Property Investors will raise US$1.29 billion for a fund which will invest in property and related assets throughout the Asia Pacific Region, with a primary focus on China and India. Citigroup and investors will pump US$200 million into the fund. Currently, about 40 percent of the fund’s capital has been secured. David Schaefer, head of CPI Asia Pacific, will lead a team of more than 25 professionals to manage the fund, the company said. China will constitute about one fourth of CPI’s future investment in Asia, with as much as US$800 million in the country’s real estate markets in Macau, Hong Kong and the mainland in the next three years.

LNG for Macau
China Energy Development, which has a joint venture with China Petroleum & Chemical Corp (Sinopec) to sell liquefied natural gas from Zhuhai to Macau, has raised HK$445.5 million. The company sold 270 million new shares, or 9.6 per cent of its enlarged share capital, at HK$1.65 each. China Energy was renamed in January after the company announced in October it would pay HK$280 million for a 60 per cent stake in Macau Natural Gas, which has a 50-50 joint venture with the mainland’s second-largest gas producer Sinopec to distribute LNG in Macau. The joint venture, formed in September last year with a share capital of about HK$48.5 million, is preparing the construction of gas pipelines in Macau after it won a tender in July. From the city government.

Burger King coming
Burger king is getting ready to take a bite of Macau. The New York Stock Exchange listed BKC recently announced that its Asia partner, BK ASIAPAC, PTE. LTD., has been award development rights to open in Macau and Hong Kong. In June 2005, Burger King opened its first China location in Shanghai and plan on having 1,000 outlets in China by 2015. Their foray into the SARS will begin with the opening their first BK in downtown HK this December. The company has not announced where their first Macau location will be.

Local businesses launch tourism campaign in Indonesia
Representatives from the Venetian, Wynn, Mandarin Oriental and Viva Macau were just a few of the local businesses who recently inaugurated a Macau tourism campaign in Indonesia. Held in Jakarta, the two day trade fair showcased Macau’s casino and entertainment magic and offered excellent travel packs. For example, a three-night stay at a four or five-star hotel starts from MOP 1,740 per person, air fare from Jakarta included. Macau is seeing an increase of visitors from Indonesia with 68,114 arriving last year, a 47.6 percent increase from 2005. Whilst Indonesia still constitutes a small figure of Macau’s 22 million visitors, it is still one of the most populous countries in the world and hence an attractive market for local businesses.

Macau’s future is so bright…
It’s going to have to wear shades. Macau recently won the coveted Future Award 2007 at the travel industry’s top ITB Berlin show. Over 26,000 German travel trade members of Go Asia voted that Macau is considered to be the most promising future destination in Asia. ITB Macau delegate, Maria Helena de Senna Fernandes, who serves as the Deputy Director of the Macau Government Tourist Office, commented,”The GoAsia Awards are very prestigious. Macau being chosen among so many other possibilities is a great honor for us. The award shows that the German travel trade is aware about the changes going on in Macau”.

PRD airspace enhancement deal
Air-traffic in the Pear River Delta may be made easier by the end of 2007 thanks to a deal between civil aviation authorities from Macau, Hong Kong and the mainland. The deal will create two civilian air space categories, North and South, for the PRD’s five major airports (Hong Kong, Macau, Guangzhou, Shenzhen and Zhuhai). Currently, they operate under five air-space categories. The walls separating the air space have limited the number of flights between Hong Kong and places to the north. The three parties have preliminarily agreed on the line dividing the north and south areas, but officials gave no further details. Airports in Zhuhai, Hong Kong and Guangzhou airports have air traffic control centres; Shenzhen and Macau airports don’t have any. Specifics are still being ironed out and an announcement is expected later this year.

P.F. Chang’s promotes Macanese meals
American based Chinese food chain P.F. Chang’s is putting Macanese mains on their menus. Titled “Taste of Macau”, the promotion will run in their 155 restaurants from September to December 2007. Organised with the help of the Macau Tourism office, Chang’s will feature staples such as African chicken and Portuguese style fish dishes. They’ll be served with Portuguese wine. Of course, their still working out which four to five Macanese plates will work best for American palates. Around 17 million customers are expected during the promotion. Following the Macau menu, Chang’s will be introducing Sichuan then Yunnan specials as part of their efforts to tap the evolving tastes for Chinese cuisine in the States.

January 2007 travel statistics
Macau residents seem to be dropping package-tours like a bad habit. In January 2007, package-tours carrying Macau tourists saw a 63.5 percent year-on-year drop to just 10,603, according to the Statistics and Census Service. Package-tours with Macau travelers to Hong Kong dropped 26.4 percent compared to January 2006. The decreased rates were attributed to the fact that Chinese New Year in 2006 fell in January. Meanwhile, Macau welcomed over 327,611 total package tours in January 200, a 63.3 percent year-on-year rise. Mainland visitors totaled 239,703, a 48.2 percent rise from 2006. Hong Kong visitors shot up to 24,361 for a remarkable 207.7 percent increase compared to January 2006. Taiwanese visitors totaled 17,089 for a 77 percent climb from January 2006. In terms of hotels, the number of available guest rooms in the hotel industry increased from 1,907 rooms to 12,922 registered rooms, a 17.3 year-on-year rise. Also in January 2007, these rooms held a total of 429,669 guests, a 31.3 percent year-on-year rise. The average hotel occupancy rate for this same period grew 7.3 percent to 71.8 percent. Four star hotels led this growth at 79.2 percent. The average length of stay also increased from 0.04 per night to 1.20 nights. Of these stays, 53.6 came from the mainland and 25.8 percent came from Hong Kong.

New Star at Galaxy
The StarWorld’s new “Jinmen” or “premium club” for high rollers has the galaxy crew clicking their heels. At the recent opening, the Chairman of the Galaxy Entertainment Group Dr. Chee-Woo Lui that the club represents a “a new market trend” and a tapping of the “immense opportunities in the top-tier market segment”. Nestled on StarWorld’s fifth floor, it has 18 VIP tables, 24 slots and has special travel services for VIPs-from helicopter to Rolls Royce limousine services. There’s more than just gaming, though: wine, golf and live entertainment tickets are part of the Jinmen experience.

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