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Laos – Savan Vegas in jeopardy

By - 8 October 2013

Macau-based Sanum Investment is reconsidering its development plans for Laos due to what the company describes as: “diminished confidence in operations in the country,” which borders Cambodia, Thailand and Vietnam.

The local operator opened its Savan Vegas casino and hotel in Savannakhet province in 2008. Savan Vegas is currently attracting between 8,000 to 10,000 players a month. However, it has stalled any development plans following the government’s move to take control of Thanaleng Slot Machine Club near Vientiane. 
Richard Pipes, the Executive Vice -President of Sanum has also revealed that the company had also been hit with an unexpected tax bill for US$23m.

The casino’s current capacity is around 2,000 players a day, with its 490 hotel rooms running at 80 to 90 per cent occupancy levels during the week and 100 per cent at the weekends. With Chinese players becoming a more significant segment for the casino, Savan had hoped to double its number of VIP rooms to 12 and add a Chinese-themed wing. It had also discussed investing up to $3m in upgrading the local airport.

But the onset of legal wrangles with minority partner ST Group, and the uncertainty of government seizures of gaming establishments, has left the group unwilling to make any more investments until its future is guaranteed. Sanum has filed legal documents with the World Bank’s International Centre for the Settlement of Investment Disputes, claiming the government has broken treaties protecting foreign investments. If the retroactive tax bill is not settled, the entire future of Savan Vegas could be in jeopardy.

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