Macau satellite casino operator Macau Legend Development announced Tuesday that it will no longer participate in the VIP gaming promotion business after a contract between SJM Resorts and a casino service firm it relied on to run the business expired at the end of last month.
The announcement was filed to the Stock Exchange of Hong Kong on Tuesday, citing the impact of the new gaming law passed in June last year on a company with which it cooperated for years.
“With the recent developments in the gaming promotion industry, there has been a significant impact on the VIP gaming promotion business. Further, the Macau Government passed the new gaming law on 21 June 2022 which served to provide new regulations and guidelines for the development of the Macau gaming industry, including satellite casinos, which will affect the operations of Hong Hock as a casino service provider,” read the filing, as reported by Macau Business.
According to the filing, in September 2006, Hong Hock reached an agreement with SJM Resorts, a gaming concession holder for then STDM, the predecessor of SJM Holdings, to provide the latter with services at Casino Babylon and Casino Legend Palace at Macau Fisherman’s Wharf.
It was through that company, under variable interest entity arrangements, that Macau Legend Development took part in the gaming promotion business, and took greater control of the management of VIP gaming promotions of New Legend, one of its subsidiaries, further reports Macau Business.
However, although Casino Babylon is absent from the list of satellite casinos running under the SJM license revealed by the government last month, Casino Legend Palace is still running on the gaming operator’s concession.
According to André Cheong Weng Chon, Secretary for Administration and Justice, there are a total of 11 satellite casinos in operation, with nine of them depending on SJM Holdings, one on Galaxy Entertainment Group, and one on Melco Resorts and Entertainment.
André Cheong Weng Chon
Much is changing in the gaming hub, where gaming companies MGM China, Sands China, Wynn Macau, SJM Holdings, Galaxy Entertainment, and Melco Resorts have been awarded new ten-year concessions that kicked off on January 1, 2023. The firms, which are being asked by Macau officials to ramp up investments in non-gaming activities, issued stock filings offering details on the annual fees they will pay to the government earlier this week. The details coincide with the amount to be paid as annual utilization fees of casino areas.
As reported by local media, gaming concessionaires will pay the Macau government annual utilization fees of MOP750 ($93.5) per square meter of the casino areas they operate, as indicated by stock filings sent by casino operators to the Hong Kong Stock Exchange. The amount will see a 3.3-fold increase to MOP2,500 ($311) per square meter in 2026.
In the month of December, the Macau regulator announced casinos posted their worst year since 2004 as China’s strict Covid Zero policies wrought havoc on the gambling hub. The Gaming Inspection and Coordination Bureau said that gross gaming revenue fell 56% from a year earlier to 3.48 billion patacas ($433 million), slightly below the median estimate of a 57% decline.
However, the region has recently seen a loosening of pandemic curbs, thus fueling optimism about a long-awaited recovery for the year ahead.
Original article: https://www.yogonet.com/international/news/2023/01/05/65597-satellite-casino-operator-macau-legend-stops-vip-gaming-promotion-business
