Leading Junket Operator Suncity Group Eyes Macau Casino License
Posted on: May 22, 2019, 05:31h.
Last updated on: May 22, 2019, 05:31h.
Asia’s largest junket operator, Suncity Group, would bid for a Macau gaming license should the opportunity arise, its chief investment officer said this week.
Speaking to Portuguese news agency Lusa, Andrew Lo Kai Bong said he believes Suncity could be competitive in the world’s biggest gaming market but noted Macau authorities had yet to divulge plans for the enclave’s first ever relicensing process, which is due to take place in 2022.
Suncity has been busy diversifying its business beyond facilitating trips for Chinese high rollers and lending them money to gamble in the VIP rooms it controls on behalf of Macau’s biggest casino operators.
The company has moved into casino operations, with a massive $4 billion casino in the pipeline in Vietnam, and is looking at the Philippines, Cambodia, and Japan for opportunities to create the next phase of its planned casino empire.
Stricter regulations in Macau — and on the junket industry especially — were implemented from 2014, when Beijing’s “anti-corruption” crackdown turned its attention to the enclave, and forced Suncity to look to other markets. Some 30 percent of the group’s revenue now comes from jurisdictions outside Macau, compared with just 10 percent in 2014.
Suncity said this week it expected betting volume in Macau to drop by ten to 15 percent in the second half of the year, citing a weakened Chinese economy, the escalating trade war with the United States, and even Macau’s smoking ban, as reasons for damp VIP sentiment.
Union Gaming analysts Grant Govertsen and John DeCree wrote in a note Monday that “the threat is real,” and that there is a “growing realization that Macau VIP play is bleeding to regional markets, with Cambodia and Vietnam being the primary beneficiaries.”
But according to Lo, Suncity would still jump at the chance of becoming a bona fide Macau gaming licensee.
The enclave currently licenses six operators — SJM Holdings, Sands China, Melco International, MGM China, Galaxy Entertainment and Wynn Resorts — with all other casino operators existing as sub-licensees, mostly under the SJM license.
Twenty years after Macau liberalized its casino market, all six concessions are due for renewal in 2022 and the relicensing process is likely to bring reforms to the sub-licensing regime, possibly creating more primary licenses. But for now, Macau’s government is keeping mum.
Are Junkets Run by Triads?
Suncity rose to the top of a triad-infiltrated junket industry that exploded into a multi-billion-dollar market with the liberalization of Macau’s gaming laws in the early 2000s, although there is no evidence the company has links to organized crime.
The extent of triad influence on the current and more strictly regulated market is unclear.
Research by academics at Hong Kong’s City University undertaken between 2012 and 2015 concluded that “the VIP-room operations are still dominated by triads,” but they have “readjusted their traditional intrusive role and reinvented harmonious business strategies to suit the market reality.”
In May 2017, Lo survived an apparent assassination attempt when he and his chauffeur were attacked by two suspected triad members wielding knives.
Lo escaped unscathed, while his driver suffered knife wounds to his hands as he tried to defend himself.
Related News Articles
Related News Articles
- December 18, 2020 — 11 Comments—