Macau’s Studio City Will Default on Debt, Warns Analyst

Macau’s<span id="more-8650"></span> Studio City Will Default on Debt, Warns Analyst

Studio City Macau: Despite its many non-gaming attractions it’s neglecting to attract the mass market crowds.

Studio City Macau, Lawrence Ho and James Packer’s $4.5 billion casino that is integrated on the Cotai Strip is in trouble and might default on the $1.41 billion loan utilized to complete the construction of the hotel.

That’s the word from score agency Standard and Poor’s Financial Services, which this week issued a negative perspective for the resort’s bonds, off the back of a 42.5 percent slide in their value.

Macau’s first ever TV and movie-themed resort opened in October 2015, with Packer’s girlfriend Mariah Carey headlining the night that is opening since the likes of Robert De Nero and Leonardo DiCaprio mingled among the crowd. It also had its own opening night movie, The Audition, a brief movie directed by Martin Scorsese and starring De Nero, DiCaprio and Brad Pitt.

Packer called it the ‘coolest 15 minutes ever made,’ but, with an $80 million price, it might equally be described as probably the most expensive advertisement ever made.

New Concept Fails to Drive Crowds

But for all your glitz, Studio City was conceived in a markedly different climate that is economic before Chinese President Xi Jinping’s anti-corruption drive halted the region’s success story and delivered profits tumbling for 26 straight months.

Studio City went big on non-gaming amenities, positioning itself as a non-VIP gaming location to be able to woo China’s burgeoning middle income.

It’s everything from television and film production facilities to a Batman themed flight-simulator that is 4-D coaster ride and a figure-eight Ferris wheel, but thanks to a slowing Chinese economy, visitor numbers to Macau are falling and the hordes of middle classes have failed to materialize.

Melco Distances Itself

Melco Crown owns a 60 percent stake in the home, while US hedge funds Silver Point Capital and Oaktree Capital own a 40 percent stake. Bloomberg reported this week that Melco Crown has sought to distance itself from any type of rescue package for the casino.

‘Studio City Casino Macau is a credit that is entirely separate and its own debt is non-recourse to Melco Crown Entertainment Limited. […] Investors must not assume that Melco Crown Entertainment Limited provides any economic support to Studio City Casino Macau or so it would part of for Studio City Casino Macau,’ said a Melco Representative.

There is speculation that that Melco is seeking to put the ramp up the hedge funds them out for a good price, and that the negative rating from Standard and Poor’s will strengthen its position because it wants to buy.

Duterte Takes Shock U-turn on Online Gambling

‘Gamble until you die. I do not care,’ said Philippine President Duterte Wednesday, clearly in an even more forgiving mood. (Image: rapeller.com)

Philippine President Rodrigo Duterte’s hardline crackdown on online gambling took a twist that is unexpected this week.

On Tuesday the government’s gambling operator-regulator, PAGCOR, announced it was in the entire process of ‘readying applications. it ended up being prepared to license online gambling firms that targeted ‘non-locals’ and’

‘We don’t know yet how saleable it is; there is no takers,’ PAGCOR Andrea that is chief Domingo to Reuters.’Or there could possibly be numerous applicants,’ she included brightly.

PAGCOR hopes that the licenses that are new offset a number of the revenue lost by Duterte’s systematic dismantling for the nation’s online gambling giant, Philweb. Until recently, Philweb operated 299 online gambling boutique cafés through the entire Philippines, which offered online video poker and slots via approximately 8,000 terminals.

Final year the company’s operations contributed around $12.2 million in taxes to the federal government.

Zero-tolerance

Duterte swept to power in on an agenda that promised to wipe out crime and drugs june. Literally. The president has leant their help to vigilante death squads that carry out the extra-judicial killings of criminals and drug that is habitual with impunity.

As soon as sworn in, he immediately set his sights on the Philippine online gambling industry, and in particular Philweb and its chairman, the billionaire Robert Ongpin.

Ongpin ended up being representative of the ‘oligarchs,’ which he believed were ’embedded in federal government’ and practiced ‘influence peddling.’ Meanwhile, said Duterte, online gambling ‘had to stop’ because too many Filipinos were deciding to gamble instead of working for a living. It appeared that PAGCOR was taken entirely by surprise by the announcement.

Restoration

the month Philweb was forced to announce it could wind its operations down, due to the non-renewal of its license by PAGCOR. Ongpin stepped down as president associated with the business and, as a bid that is last-ditch approval, wanted to transfer nearly all of his majority stake within the company to PAGCOR, in an effort to save the business and its 6,000 workers. PAGCOR was forced to refuse.

But on Wednesday, Duterte was clearly in an even more tolerant mood.

‘Pay the correct taxes… Gamble unless you die. I usually do not really care,’ he announced magnanimously.

Duterte is now ready to restore online gambling provided ‘taxes are correctly collected and so they [online gambling cafes] are situated or placed in districts where gambling is allowed, which means to state, not in the church distance or schools.’

‘ I became mad because perhaps the youth are gambling and there clearly was not a way of collecting the proper fees,’ he admitted.

Whether what this means is he is willing to allow Philweb to continue its operations as before is currently unclear.

Indiana Casino Union Does What Trump Taj Mahal Workers Couldn’t: Reaches New Contract with Majestic Star Riverboats

Indiana Governor Mike Pence, the current GOP vice-presidential contender, has put their state on the map for monetary gains and growth during their administration. Now a new casino union contract in the Hoosier State is also showing up its sibling chapter in Atlantic City, having effectively negotiated for benefits, where its brethren failed.

The Indiana Unite Here casino union has effectively bargained for a new contract with the two Majestic Star riverboats in Gary, a stark comparison through the union’s efforts in Atlantic City, which failed. (Image: Unite Here/youtube.com)

Indiana’s Unite Here casino union, representing chefs, wait staff, and housekeepers at the two Majestic Star riverboats in Gary, has now reached a new agreement with the gambling operator. On August 19, the two edges officially signed off for a agreement that increases wages over the next 2 yrs, while keeping the current wellness insurance programs being afforded to union members.

The deal operates through 2018.

Unite Here Local 1 spokesperson Noah Carson-Nelson told the Chicago Tribune, ‘Our members are happy. The individuals were excited that it ended up being settled fairly quickly and so it includes raises and equivalent health insurance.’

The Majestic Star casinos sit next to one another in Lake Michigan, about 30 miles southeast of downtown Chicago.

Regional 1’s moms and dad union, Unite right Here, is the organization that is same unsuccessfully continued strike at the Trump Taj Mahal in Atlantic City previously into the summer time. As a result, billionaire owner Carl Icahn announced that the casino is going to be forever shutting on 10 october.

The Trump Element

Formerly referred to as Trump Casino, Majestic Star II ended up being renamed after Trump Entertainment Resorts sold the property to Majestic in 2005 for $253 million.

The sale was part of Trump Hotels & Casino Resorts (THCR) filing for Chapter 11 bankruptcy protection in 2004. The business emerged from liquidation under the new Trump Entertainment Resorts name in 2005.

Trump’s record in Atlantic City is obviously questionable. But in Indiana, Trump’s riverboat was decidedly lucrative. On the 11 years since Majestic acquired the casino that is floating it’s never won as much cash as it did when Trump was the financial admiral associated with the ship.

In 2004, total wins eclipsed $140 million. In 2015, the Majestic Star II taken in simply half of that figure.

The Majestic Stars are two of 10 riverboat casinos in Indiana. The Hoosier State can also be home to the French Lick Resort Casino, truly the only land-based gambling location there, plus two racinos that offer slots and electronic table video gaming.

Marked Market Variations Between Two States

Back east in Atlantic City, Unite Here Local 54 was additionally fighting for higher wages and health insurance coverage at the Trump Taj Mahal. But the bankruptcy procedure already underway whenever Carl Icahn purchased the casino allowed the billionaire to temporarily suspend pension and healthcare benefits as he worked to upright the casino’s dire situation that is financial.

But Icahn, who had been reportedly losing $100 million in the endeavor, said he needed more time before restoring benefits. Workers strolled off the task in disgust, and Icahn called their bluff in a move that ultimately caused both sides to lose.

The marketplace is quite different in northwest Indiana than in Atlantic City. Whenever the Taj Mahal closes its doorways in October, it can be the fifth casino to shutter straight down since 2014 in New Jersey.

The Blue Chip Casino and Hotel in Michigan City, Indiana also recently negotiated effectively with Unite Here Local 1. Ameristar Casino Hotel did as well, albeit after a lengthy and process that is tedious.

‘we are pleased to move ahead, and happy in an equitable manner,’ Majestic Star General Manager Barry Cregan said of the new contract that we did it.

So why would the smaller Indiana gaming union find more success featuring its boss than in the much bigger Atlantic City market? Because the Taj had been losing millions each month, while the union’s needs would only drive those losses further into the muck. A worthwhile investment in Indiana, while not thriving like they may have been over a decade ago, casinos are apparently still making enough of a profit to make union benefits.

Paddy Power Betfair Reports £47.5 Million Loss Considering Costs of Merger

Breon Corcoran, Paddy Power Betfair CEO, said that the company would not rule away further consolidation if the best opportunity arose. (Image: Business Post sunday)

Paddy Power Betfair has reported running losses of £47.5 million ($62.6 million) for the half that is first of when compared with profits of £106.5 million ($140.5) for the corresponding duration of 2015.

CEO Breon Corcoran this week attributed the losses to one-off expenses related to your merger between your two betting powerhouses, amounting to £195 million ($257 million) in total. Paddy Power and Betfair agreed terms of their £5 billion ($6.5 billion) merger in September year that is last the deal was only finalized on February 2, 2016.

Thus, short-term losses incurred during through integration, including some £29 million ($38.2) in advisory fees alone, are expected to be handsomely offset by cost saving synergies of this newly combined company further later on.

In fact, Paddy energy Betfair has upped its estimate of future price saving from £50 million ($65 million) per annum by 2018 to £65 million ($85.7 million) per from next year year.

A lot of those savings have come from job losses, with 650 of the combined company’s 7,200-strong workforce having found themselves surplus to requirements following the merger.

Revenue Up 18 Per Cent

‘People have actually been actually diligent, there is been an awful lot of difficult work done, and promptly,’ said Corcoran of the integration work. ‘Paddy Power Betfair has suffered momentum that is good a period of considerable modification.’

Corcoran also pointed to an 18 % rise in revenue for the time, to £759 million ($1 billion), as well as double-digit growth across all four of its core divisions. Discounting merger costs, would have reported underlying earnings of £181 million ($238 million), Corcoran said.

On the web revenue was up 20 percent at £440 million ($580 million), while Paddy Power’s land-based bookmaking stores recorded a 12 per cent increase in revenues to £147 million ($193 million). The company’s US and operations that are australian reported growth.

More Consolidation Available

‘The restructuring is currently largely complete plus the merger synergies are being delivered ahead of routine,’ said Corcoran. ‘We are creating a globe class procedure pelican pete slot machine free play by exploiting the assets that are unique capabilities of each legacy company, particularly in the key functions of technology, advertising and trading.

‘While our industry remains highly competitive and it is exposed to the prevailing economic and regulatory surroundings, our strong market roles, increased scale and enhanced capabilities position us well for sustainable, lucrative growth.’

Corcoran additionally refused to rule the possibility out of more consolidation. If the right asset came up during the right price his company would be well positioned to get it, he said, however the moment he was focusing in the integration process.

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