Operator News
China – Macau’s six casino concession holders sign extensions to year end
By Phil - 23 June 2022
Macau six casino licence holders have now signed extensions to their contracts until December 31 2022 with the Macau government at a cost of MOP$47m.
Galaxy Entertainment, Melco Resorts & Entertainment, MGM China, Sands China, SJM Resorts and Wynn Macau have all signed extensions which the government said were needed because the process of bidding for new gaming licenses could not be completed before the licences ran out on June 26.
Melco Resorts Macau confirmed it would pay the Macau government MOP47m (equivalent to approximately US$5.8m) upon signing of the Extension Agreement as premium for such extension.
Melco Resorts Macau will also submit a bank guarantee in an amount of not less than MOP820m (equivalent to approximately US$101.4m) to the Macau government within three months from the date of signing of the Extension Agreement to guarantee the satisfaction of any labor liabilities upon expiry of the subconcession. The Macau government may require an increase in the amount of such guarantee, depending on the actual number of employees employed by Melco Resorts Macau.
Under the Extension Agreement and in accordance with current applicable Macau law, Melco Resorts Macau also acknowledges that the gaming areas, gaming support areas and the gaming equipment of Altira Casino, City of Dreams Casino and Studio City Casino, as agreed with the Macau government, will revert to the Macau SAR, without compensation and free and clear from any charges or encumbrances at the expiration of the subconcession. In addition, on June 23, 2022, Melco Resorts Macau and each of Altira Resorts Limited, COD Resorts Limited and Studio City Developments Limited, the subsidiaries of the Company holding the land lease rights for the properties on which Altira Casino, City of Dreams Casino and Studio City Casino (the “Land Concessionaires”) are located, respectively, executed an undertaking in favor of the Macau government pursuant to which Melco Resorts Macau and the respective Land Concessionaire committed to sign the documents required by the Macau government so that the Altira Casino, City of Dreams Casino and Studio City Casino revert to the Macau SAR in accordance with law.
The operator said: “We are pleased to see a formal extension of our subconcession and appreciate the Macau government’s efforts to ensure a coordinated process. We believe the actions today set a clear pathway towards a smooth transition ahead of the tender for the new concessions. We are committed to participating in the upcoming tender and remain aligned with the Macau government’s vision to further the development of Macau and its economy.”
Studio City International Holdings Limited confirmed: “Studio City Casino, entered into an amendment agreement to its subconcession contract pursuant to which the Gaming Operator’s subconcession, which is due to expire on June 26, 2022, was extended to December 31, 2022 which coincides with the extended expiration date of all the other concessions and subconcessions in Macau.
“In addition, on June 23, 2022, the Gaming Operator and Studio City Developments Limited, the subsidiary of the Company holding the land lease rights for the property on which Studio City Casino is located executed an undertaking in favor of the Macau government pursuant to which the Gaming Operator and Studio City Developments committed to sign the documents required by the Macau government so that the gaming areas and gaming support areas of the Studio City Casino, in accordance with Macau law, reverts to the Macau SAR, without compensation and free and clear from any charges or encumbrances at the expiration of the Gaming Operator’s subconcession.
“The final terms of such reversion are subject to the execution of a reversion deed or similar instrument in favor of the Macau government. The Gaming Operator and Studio City Entertainment Limited, a subsidiary of the Company, have also amended the agreement under which the Gaming Operator operates the Studio City Casino to align such agreement with the newly enacted amendments to the gaming law in Macau. In addition, certain conditions imposed by the Macau government relating to the previously existing agreement, including in relation to shareholding requirements for certain direct and indirect shareholders of Studio City Entertainment Limited, are no longer applicable,” it added.
