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

13 Mar

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

Macau’s<span id="more-9736"></span> Studio City Will Default on Debt, Warns Analyst

Studio City Macau: Despite its many non-gaming tourist attractions it’s failing 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 used 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 as the likes of Robert De Nero and Leonardo DiCaprio mingled on the list of crowd. It even had a unique night that is opening, 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 tag, it could equally be described as the most advertisement that is expensive made.

Brand New Concept Doesn’t Drive Crowds

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

Studio City went big on non-gaming amenities, positioning itself as a non-VIP gaming destination in order to woo China’s burgeoning class that is middle.

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

Melco Distances Itself

Melco Crown owns a 60 percent stake in the property, 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 at a entirely split credit group and its own debt is non-recourse to Melco Crown Entertainment Limited. […] Investors should not assume that Melco Crown Entertainment Limited will give you any economic support to Studio City Casino Macau or so it would step up for Studio City Casino Macau,’ said a Melco Representative.

There is speculation that that Melco is wanting to put the end 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 really 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 us government’s gambling operator-regulator, PAGCOR, announced it was in the entire process of ‘readying application forms. so it was ready to license online gambling firms that targeted ‘non-locals’ and’

‘We don’t know yet how saleable it is; there might be no takers,’ PAGCOR primary Andrea Domingo admitted to Reuters.’Or there could be many applicants,’ she added brightly.

PAGCOR hopes that the brand new licenses might offset a few of the income lost by Duterte’s systematic dismantling of the country’s online gambling giant, Philweb. Until recently, Philweb operated 299 online gambling boutique cafés through the entire Philippines, which offered video that is online and slots via approximately 8,000 terminals.

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

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.

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

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

Renovation

the month Philweb was forced to announce it would wind its operations down, as a result of the non-renewal of its license by PAGCOR. Ongpin stepped down as president of this business and, as a last-ditch bid for approval, agreed to transfer almost all of his majority stake within the company to PAGCOR, in an attempt to save the company and its particular 6,000 employees. PAGCOR had been forced to refuse.

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

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

Duterte happens to be prepared to restore gambling that is online ‘taxes are correctly collected plus they [online gambling cafes] are situated or placed in districts where gambling is allowed, which means to state, not inside the church distance or schools.’

‘ I was mad because perhaps the youth are gambling and there is no way of collecting the proper fees,’ he admitted.

Whether this implies he is ready to permit Philweb to continue its operations as before is currently unclear.

Indiana Casino Union Does What Trump Taj Mahal Workers Couldn’t: Hits New Deal with Majestic Celebrity Riverboats

Indiana Governor Mike Pence, the current GOP contender that is vice-presidential has put his state on the map for economic gains and development during his administration. Now a casino that is new contract in the Hoosier State is also showing up its sis chapter in Atlantic City, having successfully negotiated for benefits, where its brethren failed.

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

Indiana’s Unite Here casino union, representing cooks, wait staff, and housekeepers at the two Majestic Star riverboats in Gary, has already reached a new agreement with the gambling operator. On August 19, the two edges officially signed off on a agreement that increases wages over the next two years, while maintaining the health that is current programs being afforded to union members.

The offer runs through 2018.

Unite Here Local 1 spokesperson Noah Carson-Nelson told the Chicago Tribune, ‘Our people are happy. The people were excited that it includes raises and the same medical insurance. so it was settled fairly quickly and’

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

Regional 1’s parent union, Unite right Here, is the same organization that unsuccessfully went on attack during the Trump Taj Mahal in Atlantic City earlier in the day into the summer. As a result, billionaire owner Carl Icahn announced that the casino will be permanently shutting on October 10.

The Trump Element

Formerly known as the Trump Casino, Majestic Star II had been renamed after Trump Entertainment Resorts offered the home to Majestic in 2005 for $253 million.

The sale was element of Trump Hotels & Casino Resorts (THCR) filing for Chapter 11 bankruptcy protection in 2004. The company 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 profitable. Within the 11 years since Majestic acquired the casino that is floating it’s never won as much cash since it did whenever Trump was the financial admiral associated with ship.

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

The Majestic Stars are two of 10 riverboat casinos in Indiana. The Hoosier State is also home to your French Lick Resort Casino, the actual only real land-based gambling venue there, plus two racinos that provide slots and table gaming that is electronic.

Marked Market Differences Between Two States

Back east in Atlantic City, Unite Here Local https://myfreepokies.com/pelican-pete/ 54 was additionally fighting for higher wages and health insurance at the Trump Taj Mahal. But the bankruptcy process already underway when Carl Icahn purchased the casino allowed the billionaire to temporarily suspend pension and healthcare benefits as he worked to upright the casino’s dire financial situation.

But Icahn, who was reportedly losing $100 million regarding the endeavor, stated he needed more time before restoring benefits. Employees strolled off the task in disgust, and Icahn called their bluff in a move that ultimately caused both edges to lose.

The market is quite different in northwest Indiana than in Atlantic City. Whenever the Taj Mahal closes its doors in October, it will become the casino that is fifth shutter straight down since 2014 in nj.

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

‘We’re happy to move ahead, and happy that individuals did it in an equitable manner,’ Majestic Star General Manager Barry Cregan stated of the new agreement.

So why would small Indiana gaming union find more success along with its boss than in the much bigger Atlantic City market? Each month, and the union’s demands would only drive those losses further into the muck because the Taj was already losing millions. 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 As A Result Of Costs of Merger

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

Paddy Power Betfair has reported operating losses of £47.5 million ($62.6 million) for the very first half of 2016 in comparison to profits of £106.5 million ($140.5) for the corresponding duration of 2015.

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

Thus, short-term losings incurred during through integration, which included some £29 million ($38.2) in advisory fees alone, are anticipated to be handsomely offset by cost saving synergies for the newly combined company further down the line.

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

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

Revenue Up 18 %

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

Corcoran additionally pointed to an 18 per cent rise in revenue for the time scale, to £759 million ($1 billion), in addition to 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 line revenue was up 20 percent at £440 million ($580 million), while Paddy Power’s land-based bookmaking stores recorded a 12 % increase in revenues to £147 million ($193 million). The organization’s US and Australian operations also reported development.

More Consolidation Viable

‘The restructuring happens to be mostly complete as well as the merger synergies are being delivered in front of schedule,’ said Corcoran. ‘we have been creating a world class operation by exploiting the unique assets and abilities of each legacy business, particularly in the key functions of technology, marketing and trading.

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

Corcoran also refused to rule out of the possibility of more consolidation. If the asset that is right up at the right price his company would be well placed to obtain it, he said, but the moment he had been focusing on the integration process.

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