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China – Sanford C. Bernstein links Genting’s Macau bid with SJM’s ‘financial difficulties’

By - 21 September 2022

Sanford C. Bernstein believes that Genting Malaysia’s effort to gatecrash the six current casino licence holders in Macau could see it team up with the SAR’s originally casino group SJM due to its ‘financial difficulties.’

SJM Holdings recently reported a loss of HK$2.75bn in the first half of the year, 88 per cent more than the losses recorded in the first half of last year (HK$1.46bn).

The brokerage firm said: “We do not expect Genting to win an outright concession and displace an incumbent. However, we see Genting as positioning itself to be a prospective rescuer in the event that a concession holder experiences financial difficulties and may require a partner (such as SJM), or a potential buyer of a willing seller in the future. We would point to SJM as having the most issues.”

Genting’s bid has been conditionally accepted.

Analysts at Berstein added: “Genting has also been mentioned as having a good relationship with Chinese authorities and had sponsored the development of the Genting Snow Park in Hebei Province which was used as one of the venues for the 2022 Winter Olympics. There are other ties in China that could prove valuable to Genting’s pursuit of eventual entry into Macau.

“Genting also has experience developing theme parks as part of its integrated resorts in Malaysia and Singapore and has extensive customer databases in Asia,” it added.

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